Montoya v. Ahern (In re W.N. Connell & Marjorie T. Connell Living Trust, Dated May 18, 1972), 426 P.3d 599

Eleanor Connell Hartman Ahem served as sole trustee and a beneficiary of the W.N. Connell Living Trust (1972 Trust); two daughters, Jacqueline Montoya and Kathryn Bouvier, were co‑beneficiaries of a 65% income share.
The 1972 Trust contains a broad no‑contest clause providing that any person who "attack[s], oppose[s] or seek[s] to set aside the administration and distribution" of the trust would receive $1 and no more.
As trustee, Eleanor stopped disbursing Jacqueline and Kathryn's 65% share; they sued, obtained summary judgment that they were entitled to the 65% income and that Eleanor breached fiduciary duties, and the court appointed a successor trustee.
The successor trustee discovered improper withdrawals and deficiencies in Eleanor's accounting; the district court found multiple breaches and surcharged Eleanor's beneficiary interest.
Jacqueline and Kathryn moved to enforce the no‑contest clause to reduce Eleanor's beneficiary share to $1; the district court declined, finding Eleanor’s misconduct was in her trustee capacity and that enforcing the no‑contest clause would be a disproportionate remedy.
The Nevada Supreme Court affirmed, holding that a no‑contest clause does not apply to actions taken by a beneficiary in a trustee capacity absent clear settlor intent to the contrary.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether a no‑contest clause can forfeit a beneficiary’s interest when the beneficiary breaches fiduciary duties as trustee	Jacqueline/Kathryn: Clause is broad; Eleanor’s trustee misconduct was undertaken to benefit herself as beneficiary, so forfeiture to $1 is proper	Eleanor: Actions were taken in a fiduciary/trustee capacity; no‑contest clauses should not reach trustee acts unless settlor plainly says so	Court: No‑contest clause does not apply to actions taken by a beneficiary acting in trustee capacity absent clear settlor intent; other remedies (surcharge, damages) address breaches

Connell Living Tr., 393 P.3d 1090 (Nev. 2017) (prior proceedings involving the same trust and parties)
Hannam v. Brown, 956 P.2d 794 (Nev. 1998) (standard of review and trust construction principles)
Johnson v. Greenelsh, 217 P.3d 1194 (Cal. 2009) (discussion of when no‑contest clauses operate against trustee‑beneficiaries)
Organ v. Winnemucca State Bank & Trust Co., 26 P.2d 237 (Nev. 1933) (principle that law disfavors forfeitures)
Ivancovich v. Meier, 595 P.2d 24 (Ariz. 1979) (no‑contest clauses strictly construed)