Tseng v. Tseng
352 P.3d 74
Or. Ct. App.2015Background
- Patrick Tseng created a revocable trust; respondents (his sons Paul and Peter) served as cotrustees; petitioners (other children) were beneficiaries. Patrick died in 2009.
- After Patrick’s death petitioners learned ~$1.8 million had been transferred out of the trust between March 2008 and Patrick’s death and sought information whether Patrick authorized those transfers.
- Respondents refused, invoking OUTC provisions that restrict beneficiary access to information while a settlor is alive (ORS 130.710(9) and ORS 130.510(1)), and moved for summary determination that petitioners had no right to pre-death information.
- Probate court granted respondents’ motion and dismissed the petition; petitioners appealed arguing that, as qualified beneficiaries of a formerly revocable trust, they are entitled under ORS 130.710(1) to the material facts necessary to protect their interests, which may include pre-death trustee actions.
- The appellate court framed the question as whether, after the settlor’s death, ORS 130.710(1) requires trustees of a formerly revocable trust to provide beneficiaries information about administration during the settlor’s lifetime.
Issues
| Issue | Plaintiff's Argument (Tseng) | Defendant's Argument (Tseng respondents) | Held |
|---|---|---|---|
| Whether qualified beneficiaries of a formerly revocable trust are entitled after the settlor’s death to information about trust administration that occurred during the settlor’s lifetime | Qualified beneficiaries are entitled under ORS 130.710(1) to the material facts necessary to protect their interests, including whether pre-death transfers were authorized | ORS 130.710(9) bars beneficiaries from any right to notice/information about trust administration during the settlor’s life; petitioners had no cognizable interest pre-death and thus need no pre-death information | Reversed: once trust becomes irrevocable on settlor’s death, qualified beneficiaries are entitled to material facts necessary to protect their interests, which can include information about pre-death trustee actions |
| Whether a beneficiary’s entitlement to information under OUTC depends on whether the beneficiary held a common-law property interest pre-death | Entitlement to information flows from OUTC’s definition of beneficiary and qualified beneficiary status, not from common-law property status | Beneficiaries of a revocable trust had no enforceable interest while settlor alive, so pre-death information is irrelevant | Held for plaintiffs: OUTC creates statutory interests and standing; entitlement to information does not turn on common-law property status |
| Whether trustees may be held accountable post-death for pre-death acts taken without settlor approval (and thus whether beneficiaries need pre-death facts to pursue redress) | If pre-death transfers were unauthorized (not directed/ratified by settlor and not authorized by trust), beneficiaries may challenge and need facts to assess harm | If settlor controlled trust during life or settlor authorized transfers, beneficiaries cannot maintain post-death claims | Held for plaintiffs in principle: beneficiaries may, after settlor’s death, seek redress for pre-death trustee breaches that harmed their interests; entitlement to information is limited to material facts needed to determine that question |
| Scope of relief on summary determination | Petitioners sought at least narrow factual disclosure (did settlor authorize $1.8M transfer) rather than a full accounting | Respondents sought dismissal as a matter of law of any obligation to disclose pre-death information | Court reversed summary dismissal and remanded for probate court to determine scope of material facts to be disclosed under ORS 130.710(1) |
Key Cases Cited
- Hope Presbyterian v. Presbyterian Church (USA), 352 Or. 668 (2012) (discusses Oregon’s adoption and interaction with the Uniform Trust Code)
- Cloud v. U.S. National Bank, 280 Or. 83 (1977) (recognizes beneficiaries may challenge pre-death trustee acts when settlor lacked capacity or did not validly approve)
- Johnson v. Commercial Bank, 284 Or. 675 (1978) (revocable trust settlor retains entire interest while alive)
- Githens & Githens v. Githens, 227 Or. App. 73 (2009) (discusses beneficial interest in revocable trust not being property for other contexts)
- In re Estate of Giraldin, 55 Cal. 4th 1058 (2012) (permitting beneficiaries to challenge trustee conduct during settlor’s lifetime where appropriate)
- In re Trust No. T-1 of Trimble, 826 N.W.2d 474 (Iowa 2013) (holders generally not entitled to full accounting for settlor-life period; does not foreclose need-based disclosure when breaches alleged)