In the Matter of the Estate of: K. Wendell Reugh
37255-3
| Wash. Ct. App. | Dec 14, 2021Background
- K. Wendell Reugh executed a revocable living trust and a pour‑over will in 2011; the trust directed the residuary to a charitable foundation (or to INWCF/Innovia if no foundation existed).
- Reugh died in March 2015; the will was admitted to probate the same month and the estate transferred the bulk of assets into the trust (Innovia received ~ $15M after taxes).
- Reugh’s three adult children were named beneficiaries (each $1.5M) but in February 2017 filed a petition to invalidate the trust, alleging undue influence, fraud, lack of funding, and drafting defects.
- Litigation included removal of prior co‑personal representatives, appointment of Northwest Trustee as successor trustee, extensive motion practice, discovery, and appeals (including an earlier appellate decision, Reugh I).
- The trial court dismissed the amended trust contest as a de facto will contest barred by the four‑month will‑contest statute, denied the children’s late mediation tactic under TEDRA, and awarded attorney fees and costs to Innovia and Northwest Trustee; the court of appeals affirmed.
Issues
| Issue | Plaintiff's Argument (Reugh) | Defendant's Argument (Innovia / Northwest Trustee) | Held |
|---|---|---|---|
| Effect of TEDRA mediation notice | Filing notice of mediation under TEDRA required court to stay proceedings and order mediation | Court retained authority; TEDRA does not strip judicial power to decide dispositive motions or deny mediation for good cause | Court may rule on motions despite mediation notice; children’s last‑minute notice did not bar reconsideration ruling |
| Applicable statute of limitations | Trust contest governed by 2‑year limitations under RCW 11.103.050(1) | Challenge to trust attacks the will (pour‑over) and is a de facto will contest subject to 4‑month will‑contest limitation | Characterized as a will contest; 4‑month limitation applies; petition filed after the deadline and was dismissed |
| Alleged funding/formal defects of trust | Trust was not funded during settlor’s lifetime so invalid; or funding defects distinguish it from will contest | Pour‑over will funded trust at death; funding/formal defects, if any, implicate the will and are time barred as will contest | Funding defects remedied by pour‑over at death; attacks on funding are effectively attacks on the will and time barred |
| Award of attorney fees and costs under TEDRA | Fees improper or excessive; relied on Scott Fetzer limitations | TEDRA authorizes equitable fee awards; court may consider broad factors and sanction abusive litigation conduct | Fee award affirmed as equitable and not an abuse of discretion; court split liability between children and trust and also awarded appellate fees |
Key Cases Cited
- In re Estate of Reugh, 10 Wn. App. 2d 20, 447 P.3d 544 (2019) (prior appellate decision addressing removal of co‑representatives and related procedural history)
- In re Estate of Rathbone, 190 Wn.2d 332, 412 P.3d 1283 (2018) (discussing TEDRA mediation procedures and standards of review)
- Silver v. Rudeen Mgmt. Co., 197 Wn.2d 535, 484 P.3d 1251 (2021) (standard of review for statute of limitations questions reviewed de novo)
- In re Estate of Finch, 172 Wn. App. 156, 294 P.3d 1 (2012) (holding that proceedings challenging a will’s validity are governed by will‑contest rules for statute of limitations)
- In re Estates of Palmer, 146 Wn. App. 132, 189 P.3d 230 (2008) (same principle: substantive challenge to testamentary disposition treated as will contest)
- Scott Fetzer Co. v. Weeks, 114 Wn.2d 109, 786 P.2d 265 (1990) (fee‑award limits under Washington long‑arm statute; court here deemed it inapposite to TEDRA fee analysis)
- In re Estate of Black, 116 Wn. App. 476, 66 P.3d 670 (2003) (discussing appellate review of TEDRA‑based fee awards and abuse‑of‑discretion standard)