In re Thompson Trust
801 N.W.2d 23
Iowa Ct. App.2011Background
- Thompson Trust (established 1912; terminates 2018) filed 2008 annual report in July 2009 outlining 2008 activities.
- Objector Arabella Decker, a beneficiary, objected to asset allocation and perceived lack of diversification, citing Wells Fargo stock concentration.
- Trustees moved for summary judgment in December 2009, arguing the objections were barred by res judicata, consent and affirmation, estoppel by acquiescence, laches, and lack of damages.
- District court found no genuine issues of material fact and granted summary judgment, then awarded Trustee fees subject to review at final determination.
- On appeal, the supreme court affirmed in part, reversed in part, and remanded for hearing on objections to retention of Wells Fargo stock; fees affirmed.
- The opinion notes the Trustees’ 2007 report approved continued concentration of Wells Fargo stock; 2008 objections were severed into issues about ongoing holdings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the doctrines bar the 2008 objection. | Decker: bars apply to preclude objection to 2008 report. | Trustees: res judicata and others may bar, given prior approvals and inaction. | Partially upheld: some doctrines apply to 2008 investment decisions, others do not bar ongoing objections. |
| Application of consent/affirmation and estoppel by acquiescence to 2008 investments. | Decker argues no consent or acquiescence to 2008 investments. | Trustees: silence on 2007 report constitutes consent/affirmation and acquiescence to 2008 holdings. | Affirmed: consent/affirmation and estoppel by acquiescence applied to 2008 Wells Fargo concentration. |
| Whether res judicata bars the 2008 objections. | Decker contends res judicata does not apply year-to-year to new objections. | Trustees: prior approvals preclude later objections to similar issues. | Reversed in part: res judicata not applicable to ongoing objections about 2008 activities. |
| Whether laches barred the 2008 objection. | Decker delayed objecting for years, despite notice. | Trustees: delay was unreasonable and prejudicial. | Reversed in part: laches did not bar this separate yearly objection; could be considered for time-limited issues. |
| Proper disposition of the fee award. | Fees were excessive and not properly justified. | Fees reasonable given research and defense necessary to defend objections. | Affirmed: district court did not abuse discretion; fees and costs approved. |
Key Cases Cited
- Harvey v. Leonard, 268 N.W.2d 504 (Iowa 1978) (trustee duty of loyalty and good faith)
- In re Marriage of Fields, 508 N.W.2d 730 (Iowa 1993) (estoppel by acquiescence defined)
- Meier v. Senecaut, 641 N.W.2d 532 (Iowa 2002) (appellate preservation and waiver principles)
- Aluminum Co. of Am. v. Musal, 622 N.W.2d 476 (Iowa 2001) (issues not raised on appeal waived)
- Carr v. Bankers Trust Co., 546 N.W.2d 901 (Iowa 1996) (summary judgment standard and standard of review)
- Sorensen v. Shaklee Corp., 461 N.W.2d 324 (Iowa 1990) (summary judgment principles and burden on non-moving party)