944 N.W.2d 808
S.D.2020Background
- Russell I. Carver created a revocable trust in 2001 and amended it multiple times (notably in 2012 and again in 2016–2017), shifting trusteeship and beneficiaries and ultimately disinheriting stepchildren.
- Russell died March 16, 2017. Within one year, Kenneth and Kelli McFarland filed a petition under SDCL chapter 21-22 seeking court supervision and a declaration that the 2001 trust and the 2012 amendment were valid (and that later amendments were invalid).
- Edwin Jenkins (successor trustee under the later amendments) filed an objection and moved for judgment on the pleadings, arguing the McFarlands’ trust challenge was time-barred because a trust contest must be commenced by service of summons within one year under SDCL 55-4-57(a)(1).
- The circuit court granted Jenkins’s motion and dismissed the portion of the petition seeking declaratory relief on trust validity; the McFarlands appealed.
- The Supreme Court reversed: it held a challenge to a trust’s validity may be brought in a petition for judicial supervision under chapter 21-22 if it is timely under SDCL 55-4-57(a), and that filing the chapter 21-22 petition (not personal service) commences the judicial proceeding for purposes of SDCL 55-4-57(a).
Issues
| Issue | Plaintiff's Argument (McFarland) | Defendant's Argument (Jenkins) | Held |
|---|---|---|---|
| Whether a trust validity challenge may be included in a petition for judicial supervision under SDCL chapter 21-22 | Yes—chapter 21-22 petitions can include challenges to a trust’s validity | No—chapter 21-22 is for administration only; validity challenges must be separate actions | Yes—a challenge may be raised in a chapter 21-22 petition so long as it is timely under SDCL 55-4-57(a) |
| Whether filing a chapter 21-22 petition "commences" a judicial proceeding under SDCL 55-4-57(a), or whether personal service/summons is required | Filing the petition commences the proceeding; Title 15 service rules do not control where chapter 21-22 prescribes filing | Trust contest is a civil action; service of summons under Title 15 is required to commence the contest | Filing a chapter 21-22 petition commences the judicial proceeding for purposes of SDCL 55-4-57(a); personal service is not required to meet the statute’s commencement requirement |
| Whether omission or delayed mailing of notice to an interested trustee requires dismissal | Omission does not negate that the proceeding commenced; remedy is to cure notice on remand | Failure to give timely notice to an interested trustee should bar or invalidate the challenge | Dismissal was improper; failure to give notice is a procedural defect to be cured on remand (interested parties who received notice or had actual notice are bound) |
Key Cases Cited
- In re the Admin. of the Lee R. Wintersteen Revocable Tr. Agreement, 907 N.W.2d 785 (S.D. 2018) (trust contests must be brought within SDCL 55-4-57 timeframes; does not preclude raising a timely trust challenge in a chapter 21-22 petition)
- In re Elizabeth A. Briggs Revocable Living Tr., 898 N.W.2d 465 (S.D. 2017) (SDCL 55-4-57’s purpose is expeditious trust administration)
- Specialty Mills, Inc. v. Citizens State Bank, 558 N.W.2d 617 (S.D. 1997) (definition and scope of "judicial proceeding")
- Citibank v. S.D. Dep’t of Revenue, 868 N.W.2d 381 (S.D. 2015) (statutory interpretation principle: read statutes as a whole to give effect to related enactments)
- In re Bickel, 879 N.W.2d 741 (S.D. 2016) (failure to serve all interested parties in probate does not necessarily deprive court of power as to those properly notified)
- Spade v. Branum, 643 N.W.2d 765 (S.D. 2002) (purpose of service of process: notify a party a proceeding has been commenced and provide an opportunity to respond)