Justia Trusts & Estates Opinion Summaries

The Supreme Court reversed the decision of the court of appeals reversing the judgment of the district court ruling that an alternative residuary clause in a will devising half of the testator's estate to his heirs-at-law and the other half to his wife's heirs-at-law failed as a matter of law, holding that the devise failed as a matter of law.The testator's will in this case named his wife, if she survived him, as the primary beneficiary of the residue of his estate with an alternate residuary clause devising one-half of the estate to his wife's "heirs-at-law." The couple's marriage was later dissolved, after which the testator died without having revised his will. When Appellant, the personal representative of the testator's estate, petitioned for formal probate of the will he identified only the testator's siblings as heirs and devisees. Respondents, the wife's parents, claimed that they were wrongfully omitted as devisees in the petition. The district court ruled that any purported devise to Respondents failed as a matter of law. The court of appeals reversed. The Supreme Court reversed, holding that a gift to a spouse's heirs, none of whom are identified by name, fails if the marriage dissolves after execution of the will. View "In re Tomczik" on Justia Law

The Supreme Court affirmed the determination of the court of appeals, but on different grounds, determining that two amendments to the grantor's trust were validly executed and that the district court had properly reformed the trust, holding that the district court properly struck the part of the second trust amendment that was ambiguous and unenforceable.The Grantor in this case validly executed the trust, which was properly witnessed and notarized, and then executed two amendments that significantly increased the amount that Respondent would inherit. After the Grantor died, Appellant moved to invalidate the amendments. The district court granted the motion in part and struck a portion of the second trust amendment due to ambiguity but upheld the remaining terms of the amendment, including the increased amount inherited by Respondent. The court of appeals affirmed, holding that the amendments were validly executed and properly reformed under Minn. Stat. 501C.0415. The Supreme Court affirmed on other grounds, holding (1) the second trust amendment was validly executed; and (2) the district court properly upheld the portions of the second trust amendment governing asset distribution. View "In re Trust of Moreland" on Justia Law

The Supreme Judicial Court vacated the judgment of the district court dismissing Key Bank National Association's complaint for foreclosure because the debtor or the debtor's estate was a necessary party and was not participating in the action, holding that neither the debtor nor the debtor's estate was a necessary party to the action.The debtor borrowed money from KeyBank and executed a promissory note for the loan. After the debtor died intestate the property at issue passed by operation of law to the debtor's wife as a surviving joint tenant. After the note went into default the wife conveyed the property to a third party. Thereafter, embank filed a complaint for foreclosure of the property against the debtor's wife and estate, as well as third party. The trial court dismissed the action without prejudice, holding that either the debtor or his estate must be named as a necessary party to the foreclosure action. The Supreme Judicial Court vacated the dismissal, holding that because a foreclosure does not include a claim for a deficiency judgment and is therefore solely in rem in nature any mortgagor or successor in interest is a necessary party but a deceased debtor is not. View "KeyBank National Ass'n v. Keniston" on Justia Law

Consolidated appellate proceedings involved a dispute between the trustees and beneficiaries of the Bellingrath-Morse Foundation Trust ("the Trust"). In appellate case no. SC-2023-0001, beneficiaries of the Trust, Rhodes College, Huntingdon College, and Stillman College, petitioned the Alabama Supreme Court for a writ of mandamus directing the circuit court Court to vacate its November 23, 2022, order granting the trustees of the Trust relief from a final judgment pursuant to Rule 60 (b)(5), Ala.R.Civ.P. In appellate case no. SC-2023-0011, the beneficiaries appealed the same circuit-court order granting Rule 60(b)(5) relief to the trustees. Walter Bellingrath (deceased) established the charitable Trust in 1950. Bellingrath contributed to the Trust, including the Bellingrath Gardens ("the Gardens"). The trustees and beneficiaries disagreed as to whether the Trust indenture contemplated a subsidy of the Gardens by the Trust: the trustees believed the Gardens were a "purpose" of the Trust requiring perpetual funding; the beneficiaries believed the Gardens were merely an asset of the Trust and subject to closure if not profitable. A 1981 agreement limited the payments or distributions by the Trust for the support of the Gardens. In a 2003 amendment to the 1981 agreement, the beneficiaries gave up their right to request the trustees seek court instructions concerning whether the Gardens should be open or not, and the trustees agreed that they would not increase the payments for the support of the Gardens above 20% of the total annual distribution amount without the unanimous consent of the beneficiaries. In 2017, the trustees contended their ability to maintain the Gardens had been substantially impaired by the funding restraints of the 1981 agreement and the 2003 amendment, and they sought instructions on how the existing funding agreement regarding the Gardens should be revised. After the Alabama Supreme Court released its opinion in "Ex parte Huntingdon College," the trustees immediately moved the circuit court seeking relief from the 2003 judgment pursuant to Rule 60(b)(5), alleging that new circumstances had arisen since the 2003 judgment was entered, rendering prospective application of the 2003 judgment inequitable. In appellate case no. SC-2023-0001, the Alabama Supreme Court concluded the beneficiaries demonstrated a clear legal right to a writ of mandamus directing the circuit court to vacate its November 2022, Rule 60(b) order. In appellate case no. SC-2023-0011, the Court dismissed the appeal filed by the beneficiaries concerning that same order. View "Ex parte Huntingdon College, et al." on Justia Law

Michael Ewing, in his capacity as personal representative, appealed a district court’s judgment, amended judgment, and order on motion to show cause. Ewing was the personal representative of the estate of Chiyoko Ewing, his mother. Chiyoko died in 1989 leaving a will devising all of her property in equal shares to her four children: Ewing, Jeffery Ewing, Sherry Ewing, and Nancy Burkhart. At the time of her death, Chiyoko owned a home in Grand Forks as well as various items of personal property located within the home. Following her death, Jeffery lived in and maintained the home, paid the real estate taxes and the mortgage, and made substantial improvements to the home. Jeffery died in 2019. Ewing filed an “Inventory and Appraisement” identifying the property owned by Chiyoko at the time of her death. An evidentiary hearing was held to determine ownership of the property. The court found the siblings agreed they did not want to sell the home to a stranger. The issues of whether oral agreements between Jeffery and the siblings were contested. In March 2021, the district court entered a judgment, finding Jeffrey's estate owned the home. Ewing appealed. The North Dakota Supreme Court dismissed the appeal concluding the administration of the estate was not complete because the personal property was not addressed. In January 2022, another evidentiary hearing was held to address ownership of the items of personal property identified on the inventory list. While it was disputed at the evidentiary hearings, the district court found the siblings already divided the personal property amongst themselves by agreement. The district court entered an amended judgment finding all items of personal property, with two exceptions not at issue here, were assets of Jeffery's estate, and ordered Ewing to return those items to the estate. Jeffrey's estate moved to hold Ewing in contempt for failing to return the ordered items to the estate. This motion was granted, and Ewing appealed, arguing the court erred in finding an oral contract between the parties, mutual assent on all terms of the contract, and partial performance of an oral agreement sufficient to remove it from the statute of frauds. Ewing also argued the district court’s findings of fact regarding ownership of personal property, whether the real property was maintained, responsibility for administration costs, and the award and offset of damages were clearly erroneous. Finding no reversible errors, the North Dakota Supreme Court affirmed. View "Estate of Ewing" on Justia Law

The Supreme Court reversed the judgment of the South Dakota Life and Health Guaranty Association denying the protests brought by the South Dakota Bankers Benefit Plan Trust as to the Association's assessment schedule it established to cover an insolvent insurer's obligations, holding that the Trust was not liable to pay the contested assessments.In 2017, the Association, which covers impaired and insolvent insurers' obligations to their insureds by assessing Association members, assumed liability for the insolvent insurer at issue and established a five-year assessment schedule. The Trust paid three years of the five-year schedule but protested the requirement to pay the remaining two because they were assessed after the insolvent insurer's membership in the Association ended. The Association denied the protests. The South Dakota Division of Insurance's Office of Hearing Examiners reversed, determining that the Association lacked authority to assess the Trust for the last two assessments. The circuit court reversed. The Supreme Court reversed, holding that the Trust was not liable to pay the Association's 2020 and 2021 assessments. View "S.D. Life & Health Guaranty Ass'n v. S.D. Bankers Benefit Plan Trust" on Justia Law

The Supreme Court affirmed the judgment of the district court granting an uncontested petition of the trustees of the Marvin S. Robinson Charitable Trust to retroactively modify the trust's terms to maintain its tax-exempt status as a "supporting organization" under the federal tax code, holding that Kan. Stat. Ann. 58a-416 authorized the retroactive modification of the trust.Under In Commissioner v. Estate of Bosch, 387 U.S. 456 (1967), which held that the Internal Revenue Service (IRS) and federal courts are not bound by decisions of lower state courts on issues of state law but that these entities will defer to decisions of a state's highest court, an order allowing the retroactive modification of a trust's terms to maintain its tax-exempt status is binding on federal tax authorities only if it emanates from the Supreme Court. The Supreme Court agreed to review the district court's order in accordance with Bosch and affirmed the district court's judgment granting the petition, holding modification of the trust was proper. View "In re Marvin S. Robinson Charitable Trust" on Justia Law

Richard Biddle and Brian Biddle questioned whether the Chancery Court of Tishomingo County, Mississippi had jurisdiction over their father’s estate. Brian and Richard also appealed the chancery court’s finding that there was no evidence of undue influence by their stepmother. After review, the Mississippi Supreme Court found venue and jurisdiction were proper and that no evidence of undue influence was presented. View "In The Matter of The Estate of Frederick Adams Biddle" on Justia Law

The Supreme Court approved the decision of the First District Court of Appeal affirming the trial court's judgment concluding that this negligence action was untimely filed, holding that Fla. Stat. 733.710(1) extinguished the claim at issue in this case.Petitioners, who were injured in an accident by Thomas Morton, sued Morton's estate for negligently operating the car and his employer, the Lewis Bear Company (LBC), for vicarious liability under the doctrines of respondeat superior and dangerous instrumentality. The trial court ruled (1) section 733.710(1) barred Petitioners' action against the estate because they failed to file their claims within two years of Morton's death; and (2) because the Estate could not be held liable, LBC could not be held vicariously liable. The court of appeal affirmed. The Supreme Court affirmed, holding (1) because Petitioners' claims against the estate were filed beyond section 733.710(1)'s deadline and did not qualify under an exception, they were barred; and (2) the court of appeal correctly held that section 733.710(1)'s statute of non claim exonerated LBC from vicarious liability for Morton's negligence. View "Tsuji v. Fleet" on Justia Law

The estate of Joseph A. Muff brings three conversion claims against Wells Fargo Bank for allegedly failing to detect that Joseph’s stepson, Josh Paige, was stealing money from Joseph by way of fraudulently endorsed checks. After denying the estate’s motion to amend its complaint, the district court granted summary judgment in favor of Wells Fargo on all three claims. The estate appealed.   The Eighth Circuit affirmed in part, vacated in part, and remanded to the district court. The court concluded that the district court did not abuse its discretion in denying the estate’s motion to amend its complaint. Further, the court explained that because the Muff Corporate and Muff Farm accounts were not controlled by Wells Fargo, any injury to those accounts under a theory of conversion is not fairly traceable to Wells Fargo. In other words, the estate has not demonstrated a “causal connection” between the “injury”—Josh’s inappropriately removing funds from said accounts—and the “conduct complained of”—Wells Fargo’s allegedly allowing this to take place. Moreover, even assuming the existence of a confidential relationship under Iowa law could give the estate standing to sue, the factual record fails to support the existence of a confidential relationship in the first place. Because the estate has not demonstrated standing, the court wrote that it lacks jurisdiction over Count 3. As with Count 2, the district court should have dismissed the claim instead of entering summary judgment for Wells Fargo. However, unlike Counts 2 and 3, the estate has standing to pursue Count 1 in federal court. View "Larry Muff v. Wells Fargo Bank NA" on Justia Law