Justia Iowa Supreme Court Opinion Summaries

Articles Posted in Trusts & Estates
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The Supreme Court reversed the judgment of the district court concluding that the Iowa Department of Human Services (DHS) was entitled to a detailed accounting and all of the residual funds The Center for Special Needs Trust Administration, Inc. had retained from Steven Muller's trust subaccount, holding that the district court erred.The Center for Special Needs Trust Administration, Inc. acted as trustee over a pooled special needs trust subaccount for the benefit of Muller. After Muller died, the Center retained all residual funds in his trust subaccount. DHS sought judicial intervention to obtain a detailed accounting of the retained funds. The district court decided in favor of DHS and ordered the Center to pay DHS all of the funds it had retained from the subaccount. The Supreme Court reversed, holding that the Center provided an adequate accounting, and therefore, the district court lacked authority to grant the relief it provided to remedy the Center's alleged failure to account for the retained funds. View "In re Medical Assistance Pooled Special Needs Trust of Steven Muller" on Justia Law

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The Supreme Court affirmed the judgment of the district court granting summary judgment for the Center for Special Needs Trust Administration, Inc., as trustee of a polled special needs trust held for the benefit of Scott Hewitt, and dismissing this action brought by the Iowa Department of Human Services (DHS) claiming it was entitled to a detailed accounting, holding that the trustee provided an adequate accounting.Title XIX of the Social Security Act required that the funds remaining in Hewitt's trust subaccount when he died must first be used to reimburse the state for its Medicaid expenditures. DHS filed a petition to invoke jurisdiction over the irrevocable trust, claiming that it was entitled to a detailed accounting to ensure that the funds retained by by the pooled special needs trust were used for a proper purpose. The district court granted summary judgment for the Center, concluding that no further accounting was required absent evidence that the Center breached its duties as trustee. The Supreme Court affirmed, holding that DHS was not entitled to relief on its claims of error. View "In re Medical Assistance Pooled Special Needs Trust Of Scott Hewitt" on Justia Law

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The Supreme Court affirmed in part and reversed in part the judgment of the district court in this appeal concerning attorney fees, holding that the court abused its discretion in ordering an eighty-nine-year-old protected person under a conservatorship to pay for two sets of attorneys to litigate the same position in the same litigation.At issue in this contentious intrafamily litigation was whether the trustee of an individual retirement account (IRA) was entitled to recover more than $200,000 in attorney fees from the assets of the IRA for prevailing in its view of who was the property beneficiary of the account. The Supreme Court affirmed in part and reversed and remanded in part, holding (1) there was no abuse of discretion in the district court's conclusion that fees were potentially recoverable and that $200,000 was a reasonable sum; but (2) the district court abused its discretion in ordering Joan Bittner, the sole beneficiary of the IRA who was under a conservatorship, to pay for both her own and the trustee's attorneys fees. View "Bittner v. U.S. Bank National Ass'n" on Justia Law

Posted in: Trusts & Estates
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The Supreme Court affirmed the judgment of the district court and the decision of the court of appeals in this dispute over the beneficiary designation of an individual retirement account (IRA), holding that the designation unambiguously conveyed the IRA to the decedent's spouse rather than an unnamed family trust.Plaintiff, one of four children of the decedent in this case, argued that his father's IRA beneficiary designation designated an unnamed family trust as the primary beneficiary. The beneficiary designation, however, began by stating that the decedent's spouse was the 100 percent primary beneficiary of the IRA. The district court entered judgment determining that the decedent's spouse should receive the entire IRA account outright. The court of appeals affirmed. The Supreme Court affirmed, holding that the lower courts correctly determined that the spouse was entitled to the IRA. View "U.S. Bank, Nat'l Ass'n v. Bittner" on Justia Law

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In this dispute - between a revocable trust and a man who had provided the settlor with services during the settlor's lifetime - over the sale of certain trust property, the Supreme Court held that the net proceeds from the sale of the property should be divided equally between the man and the trust.Helen Schardein, the settlor, purchased a lakeside lot and put it in joint tenancy with Dan Sickels. Schardein arranged that the property be deeded to herself and Sickels as joint tenants with right of survivorship. Schardein's nephew assisted her in creating a revocable trust, into which she transferred all her property, including her interest in the lot. After Schardein died, the lakeside lot was sold. The nephew filed a petition for partition of the lot, naming Sickels as a defendant. The district court ruled that the transfer of Schardein's interest into the trust had severed the joint tenancy and that the trust was entitled to 100 percent of the net sale proceeds. The Supreme Court reversed in part, holding (1) Schardein's transfer of her interest into the trust severed the joint tenancy; and (2) the net proceeds from the sale should be divided equally between Sickels and the trust, after giving the trust credit for expenses it paid during the course of the joint tenancy. View "Grout v. Sickels" on Justia Law

Posted in: Trusts & Estates
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The Supreme Court affirmed the decision of the district court granting summary judgment in favor of a beneficiary and ruling that an amendment to an irrevocable trust was invalid, holding that the surviving settlor of an irrevocable trust cannot, with the consent of all of the beneficiaries, modify the dispositive terms of an irrevocable trust without court approval.Donald and Collen Davis established the trust at issue. After Collen died, Donald sought to amend the dispositive terms of the trust. Donald and his four children signed a consent document on different days and then Donald executed an amendment altering the disposition of the trust estate. Katina Little, one of the children, brought this action challenging the validity of the amendment. The district court granted summary judgment for Little, concluding that the amendment to the trust agreement was void for lack of authority. The Supreme Court affirmed, holding that the consent of Donald and the four beneficiaries was insufficient to modify the trust after Collen's death. View "Little v. Davis" on Justia Law

Posted in: Trusts & Estates
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The Supreme Court held that the beneficiary of an estate cannot file a separate suit outside probate against the personal representative of the estate for claims arising out of and related to the personal representative's fees for administering the estate.After Roger Rand died testate, attorney Larry Storm informed Security National Bank that it had been nominated as the personal representative of the estate. Plaintiff, a beneficiary of the estate, later received a document entitled "Estate Administration Overview" that included a statement regarding fees for the estate's administration. The document reflected the maximum fees for ordinary services that a personal representative could receive. Plaintiff objected, arguing that Security National deprived the beneficiaries of the opportunity to replace the personal representative with another that required a smaller fee. The probate court reduced the fees to Security National below the requested amounts. Plaintiff then brought this suit against Security National arising from Security National's service as the personal representative of the estate. The district court held that Plaintiff's claims should have been asserted in the probate court or otherwise failed as a matter of law. The Supreme Court affirmed, holding that the district court properly granted summary judgment to Security National on all claims. View "Rand v. Security National Corp." on Justia Law

Posted in: Trusts & Estates
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In this lawsuit to set aside a will the Supreme Court affirmed the judgment of the district court for Plaintiffs on their undue influence claim and dismissing their tortious interference with inheritance claim, holding that there was no error.Shortly after the decedent died, Plaintiffs brought this action seeking to set aside the decedent's will. Their petition alleged several causes of action against Defendants, including undue influence and tortious interference with inheritance. The district court dismissed the tortious interference with inheritance claim. Later, the jury returned a verdict in favor of Plaintiffs on the undue influence claim. Both sides appealed. The Supreme Court affirmed, holding (1) the district court correctly held that Plaintiffs needed to prove Defendants' knowledge of Plaintiffs' expectancy of an inheritance from the decedent; and (2) the district court did not admit improper hearsay evidence, and Plaintiffs' lawyer did not make prejudicial statements during closing argument. View "Buboltz v. Birusingh" on Justia Law

Posted in: Trusts & Estates
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The Supreme Court affirmed the decision of the court of appeals affirming a probate court ruling that a restriction on the transfer of devise property was a restraint on alienation and void, holding that the provision was a prohibited restraint on alienation and void.The testamentary provision in this case restricted the beneficiaries from selling or transferring the devised property outside their immediate family for a period of twenty years following the testator's death. The district court ultimately held that the restriction on the property was an invalid restraint on alienation and void. The court of appeals affirmed. The Supreme Court affirmed, holding that the restriction was a restraint on alienation and that reasonable restraints on alienation are not allowed under Iowa law. View "Estate of Vera E. Cawiezell v. Coronelli" on Justia Law

Posted in: Trusts & Estates
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The Supreme Court affirmed in part and vacated in part the judgment of the court of appeals reversing the ruling of the district court finding that an amended pleading by the Estate of Francis O. Glaser related back to its original pleading and therefore permitted an additional conveyance to be set aside after the statute of limitations had lapsed, holding that the district court erred in concluding that the late amendment related back to the date of the original motion.The Estate in this case attempted to void a predate transfer of farm property by Glaser to a friend. In order to do so, at the close of the evidence, the Estate filed a motion to amend the original motion to set aside property conveyances that failed to mention the farm property. The district court permitted the late amendment and found that the amendment related back to the filing of the original motion. Therefore, the court concluded that the claim was not barred by the applicable statute of limitations and that the challenged conveyances should be set aside. The Supreme Court held, like the court of appeals, that the late claim to set aside the farm property was barred by the applicable statute of limitations. View "Kindsfather v. Bowling" on Justia Law