905 N.W.2d 748
N.D.2018Background
- Shirley A. Dixon created a revocable trust in 1972; amended in 1984 to require annual accountings to the grantor while living and to beneficiaries during the term of the trust, and to prohibit disposing of trust principal or income for less than full consideration.
- William Dixon was initial trustee; he resigned in 2009 and Billie Dixon became successor trustee; William died in 2010.
- Billie (as trustee) sued John in 2013 to reform a deed to reserve mineral interests to the trust; the district court reformed the deed and this Court affirmed in 2017.
- John sued Billie (2013) seeking an accounting, removal of trustee, reimbursement, and court supervision, alleging gifting of trust property and failure to provide annual accountings.
- About two months before a 2017 trial, Billie moved for summary judgment; the district court dismissed John's suit as moot and on the merits; John appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Mootness: whether the suit became moot after resolution of the reformation action and settlor's death | Dixon: suit is not moot; relief (accounting, removal, reimbursement) remains possible though settlor died | Billie: case moot because reformation resolved and settlor's death makes relief academic | Court: Not moot; beneficiaries can pursue trustee breach claims even though settlor died |
| Entitlement to annual accountings | Dixon: trust instrument waived settlor-only privacy and required annual accountings to beneficiaries; trustee failed to provide them | Billie: statutory scheme limits reporting to settlor while trust is revocable, so beneficiaries not entitled | Court: Dixon entitled to accountings under the trust terms; settlor waived statutory privacy; summary judgment on this issue improper |
| Improper gifting of trust property | Dixon: trustee gifted trust assets without fair consideration contrary to trust prohibition on disposing for less than full consideration | Billie: gifting followed settlor’s historical pattern and had settlor approval; lack of proof that gifts were improper | Court: Existence of trust provision against gifting and factual disputes (incl. estoppel) create genuine issues; summary judgment improper |
| Removal / court supervision of trustee | Dixon: trustee’s failures and alleged breaches justify removal or supervision | Billie: no showing of danger to trust property; settlor dead and trust winding up; no basis for removal | Court: Removal is discretionary and depends on disputed facts; summary judgment precluded further proceedings |
Key Cases Cited
- Dixon v. Dixon, 2017 ND 174, 898 N.W.2d 706 (reformation of deed reserving minerals to trust affirmed)
- Haugrud v. Craig, 2017 ND 262, 903 N.W.2d 537 (summary judgment standards)
- Tibert v. City of Minto, 2004 ND 97, 679 N.W.2d 440 (mootness and live controversy doctrine)
- Bleick v. N.D. Dept. of Human Servs., 2015 ND 63, 861 N.W.2d 138 (definition of a gift)
- Erickson v. Brown, 2012 ND 43, 813 N.W.2d 531 (estoppel generally a question of fact)
Outcome: The Supreme Court reversed the district court’s summary judgment and remanded for further proceedings because genuine issues of material fact exist and the case is not moot.