414 P.3d 1099
Utah Ct. App.2018Background
- Evan O. Koller created a revocable living trust in 2006 naming himself trustee and LuAnn K. Shaffer as successor trustee; appointment would be operative upon his death, resignation, or incapacity.
- Evan was declared incapacitated in 2006; a professional trustee served briefly, then LuAnn became trustee in 2009 after that trustee resigned.
- Kathryn Prounis (co-conservator of Evan’s estate) requested LuAnn resign so the estate could obtain bank financing; on May 29, 2009 LuAnn signed a notarized Resignation and gave it to a third party who delivered it to the bank and to the co-conservators.
- The originally proposed mortgage was abandoned, but the bank provided a line of credit five days after the Resignation was signed.
- Evan later amended the trust to name Mark Koller as successor trustee upon LuAnn’s death, resignation, or incapacity; after Evan’s death Mark sought to be appointed trustee based on the 2009 Resignation.
- The district court granted summary judgment declaring Mark the sole trustee, concluding the Resignation was unambiguous, properly delivered, and effective; LuAnn appealed arguing parol evidence, lack of delivery, absence of consideration, and factual disputes should preclude summary judgment.
Issues
| Issue | Plaintiff's Argument (LuAnn) | Defendant's Argument (Mark) | Held |
|---|---|---|---|
| Whether parol/extrinsic evidence could be admitted to show a latent ambiguity in the Resignation | Resignation was ambiguously conditioned on loan approval; court should consider extrinsic evidence of intent | Written Resignation is unambiguous; parol evidence is barred absent a true latent ambiguity | Court: Parol evidence excluded; Resignation unambiguous and Latent-ambiguity exception not satisfied |
| Whether the Resignation required consideration or was void without the loan | Resignation was given only in expectation of loan; lack/failure of consideration voids instrument | This is not a contract; consideration doctrine for contract validity is inapplicable to a written resignation instrument | Court: Not a contract case; consideration issue immaterial; Resignation effective despite loan outcome |
| Whether the Resignation was validly delivered as required by the Trust | LuAnn did not deliver it to the Grantor (or conservators) personally; she relinquished it to a third party and did not intend delivery | Trust requires only that resignation be "delivered to the Grantor"; conservators stood in place of Grantor; third-party transfer amounted to delivery | Court: Delivery requirement satisfied — relinquishment to third party who forwarded it to conservators constituted effective delivery |
| Whether disputed factual issues (acceptance/rejection of trusteeship, Mark’s acceptance) precluded summary judgment | There are factual disputes about whether LuAnn ever accepted trustee role and whether Mark accepted successor role | Even if disputes exist, Utah law allows initial rejection of trusteeship; record shows no fact issue preventing legal determination that Mark is sole trustee | Court: Factual disputes immaterial; as a matter of law the Resignation operated as resignation/rejection and Mark is sole trustee |
Key Cases Cited
- Tangren Family Trust v. Tangren, 182 P.3d 326 (Utah 2008) (parol-evidence exceptions and contract interpretation principles)
- Mind & Motion Utah Invs., LLC v. Celtic Bank Corp., 367 P.3d 994 (Utah 2016) (latent-ambiguity standard; extrinsic evidence admissible only in narrow collateral circumstances)
- Meridian Ditch Co. v. Koosharem Irrigation Co., 660 P.2d 217 (Utah 1983) (refusing extrinsic evidence where instrument is unambiguous)
- Rowley v. Marrcrest Homeowners’ Ass’n, 656 P.2d 414 (Utah 1982) (parol evidence inadmissible to modify an unambiguous writing)
- Makoff v. Makoff, 528 P.2d 797 (Utah 1974) (applying parol evidence principles to trust instruments)
- Peterson v. Holloway, 334 P.2d 559 (Utah 1959) (defining parol evidence rule against oral testimony varying written instruments)
- Wilson v. Wilson, 89 P. 643 (Utah 1907) (delivery of deeds via third party can constitute effective delivery)