In re the Pamela Andreas Stisser Grantor Trust
2012 Minn. LEXIS 381
| Minn. | 2012Background
- Pamela Stisser created an inter vivos trust; upon her death the trust assets (~$9.1M) were to be divided among seven remainder beneficiaries, excluding Stisser.
- Stisser, as Pamela’s probate personal representative, sought: (a) payment of debts secured by Pamela’s assets from the trust, (b) compensation for probate personal representation, and (c) reimbursement of probate administration expenses.
- Trust section 3.1.1 directs the trustee to pay Pamela’s expenses and 'my legal debts' after death; section 11.1 provides fiduciaries are entitled to reimbursement and compensation.
- At Pamela’s death (2002), debts secured by Pamela’s real/personal property and a Schwab margin loan totaled about $4.36M; disputes over who pays these debts led to multi-state litigation.
- District court granted partial summary judgment that the trust did not obligate payment of secured debts; bench trial addressed compensation and administration expenses, with mixed outcomes.
- Court of Appeals partially affirmed, reversing on Schwab margin loan; this court granted review to resolve the contract interpretation and fiduciary payment questions.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does 3.1.1 obligate payment of debts secured by Pamela's property? | Stisser—section 3.1.1 uses 'my legal debts' without distinguishing secured debts. | Trustee—'debt' is a technical term; common-law reading requires not exonerating secured debts absent clear intent. | No; 3.1.1 does not require payment of Pamela's secured debts. |
| Is the trustee required to compensate Stisser as probate estate personal representative? | Stisser—trust terms mandate compensation for services rendered. | Trustee—lack of adequate documentation and benefit to estate; discretion to set compensation. | Trustee not obligated to compensate Stisser. |
| Must the trustee reimburse Lile’s Florida attorney fees for the probate estate? | Stisser—Florida attorney fees should be reimbursed as part of administration expenses. | Trustee—inadequate documentation; redacted invoices prevent reasoned decision; discretion to reimburse. | Reimbursement denied; district court's denial affirmed. |
Key Cases Cited
- Larson v. Curran, 121 Minn. 104 (Minn. 1913) (debtor directive 'pay all my just debts' treated as boilerplate with limited legal force)
- Manders v. King, 284 Ga. 338 (Ga. 2008) (debt-payment clause not sufficient to exonerate property from transfer)
- In re Trust Created by Last Will of Davidson, 223 Minn. 268 (Minn. 1947) (techical meaning of words in wills; rely on instrument's language)
- Holden, 207 Minn. 211 (Minn. 1940) (technical words in trusts/wills interpreted per well-understood meaning)
- In re Trusteeship Created by Fiske, 242 Minn. 452 (Minn. 1954) (consider instrument as a whole; grantor’s intent from entire document)
- In re McLaughlin, 361 N.W.2d 43 (Minn. 1985) (trust construction and grantor intent guidance)
- In re Simmons’ Estate, 214 Minn. 388 (Minn. 1943) (fiduciary compensation principles and discretion)
- Bush’s Estate, 804 Minn. 105 (Minn. 1975) (where time records supported compensation; distinguishable)