Rawlings v. Rawlings, 358 P.3d 1103

Background

Arnold Rawlings conveyed most of a family farm to his son Donald in 1967; the other siblings later signed quitclaim deeds seemingly conveying their interests to Donald. The family continued to treat the land as a family farm for years.
Siblings later alleged the 1967 transfers were not intended to vest sole ownership in Donald but to protect Arnold’s eligibility for welfare; they sued asserting unjust enrichment and sought a constructive trust.
In Rawlings v. Rawlings (Rawlings I), the Utah Supreme Court affirmed imposition of a constructive trust based on unjust enrichment and remanded to determine the trust’s precise contents.
On remand the district court permitted additional discovery to identify trust assets and profits; it found Donald’s discovery responses inadequate, ordered him to comply, and imposed sanctions.
Donald refused to comply with the court’s order; the district court struck his pleadings and entered default judgment, then ordered an equal division/sale of properties the court found to be part of the trust.
The Utah Supreme Court affirmed: it held the default sanction was not an abuse of discretion, applied the mandate rule to bar relitigation of the constructive trust, and upheld inclusion of additional properties and disgorgement as part of the trust res.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the district court erred by permitting post-remand discovery about trust contents	Discovery was necessary to identify the trust corpus and trace profits after the constructive trust was imposed	No further discovery was necessary; the parties already had their day in court on the merits	Discovery on remand was proper because the trial was bifurcated and the trust’s contents remained unresolved
Whether striking pleadings and entering default judgment was an abuse of discretion	Sanctions were warranted due to willful, dilatory discovery conduct and prior sanctions	The sanction was excessive; Donald had produced documents and the court should not have entered default	Entry of default judgment was not an abuse of discretion given persistent noncompliance and willful conduct
Whether the remedy should be a constructive trust (possessory) or only an equitable lien (security interest)	Siblings: constructive trust is proper to remedy unjust enrichment and to include profits/acquisitions	Donald: at most an equitable lien for improvements—no possessory interest	Mandate rule bars relitigation; Rawlings I already affirmed a constructive trust, so Donald cannot relabel it an equitable lien
Whether properties acquired or profits derived after transfers can be included in the trust (conscious-wrongdoer doctrine)	Siblings: Donald is a conscious wrongdoer; trust should include property and profits acquired with trust proceeds	Donald: siblings did not contribute to acquisition so Parks doctrine inapplicable	Court affirmed inclusion of additional properties and disgorgement under Parks and the constructive-trust findings

Key Cases Cited

Rawlings v. Rawlings, 240 P.3d 754 (Utah 2010) (affirming imposition of a constructive trust for unjust enrichment)
Parks v. Zions First National Bank, 673 P.2d 590 (Utah 1983) (discussing "conscious wrongdoer" doctrine and inclusion of property/profits in trust res)
Morton v. Continental Baking Co., 938 P.2d 271 (Utah 1997) (standard for reviewing discovery sanctions and abuse of discretion)
Kilpatrick v. Bullough Abatement, Inc., 199 P.3d 957 (Utah 2008) (factors supporting severe discovery sanctions)
First Fed. Sav. & Loan Ass'n v. Schamanek, 684 P.2d 1257 (Utah 1984) (trial court discretion in choosing discovery sanctions)