907 N.W.2d 785
S.D.2018Background
- Lee Wintersteen executed a revocable trust in 2011 and amended it three times; the third amendment (Mar. 5, 2014) removed his wife Charlotte as a beneficiary.
- After Lee showed signs of dementia (evaluated May 15, 2014) and died May 26, 2015, the trust became irrevocable; Charlotte learned of the third amendment in Sept. 2015.
- Charlotte filed a petition for court supervision of the trust on Feb. 10, 2016 (seeking accountings/inventory), but did not assert a formal trust-invalidity claim at that time.
- On Sept. 20, 2016 Charlotte moved to amend her petition to add claims that the third amendment was invalid for lack of capacity and undue influence.
- The trustees moved to bar the amendment under SDCL 55-4-57(a)(1) (one-year limit after settlor’s death). The circuit court denied the amendment as futile and held SDCL 55-4-57(a)(1) is a statute of repose; relation-back did not revive the claim.
- The South Dakota Supreme Court affirmed: the trustee-invalidity claim was governed by SDCL 55-4-57(a)(1), it was not timely commenced, and relation-back did not apply.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether SDCL 55-4-57 applies to the proposed invalidity claim given court supervision under SDCL ch. 21-22 | Charlotte: SDCL 21-22-13 lets a beneficiary petition at any time and therefore she may challenge validity during supervision | Trustees: The more specific trust-contest statute (SDCL 55-4-57) governs validity challenges; 21-22-13 concerns administration, not validity | Held: SDCL 55-4-57(a)(1) applies; 21-22-13 addresses administration and is general, so the specific one-year trust-contest statute controls |
| Whether Charlotte commenced a timely “judicial proceeding” to contest the amendment within one year of settlor’s death | Charlotte: Her Feb. 2016 petition and affidavit put the trustees on notice; court supervision proceeding counts as a judicial proceeding | Trustees: The original petition sought only supervision/accounting, not a contest of validity; no contested proceeding was started within one year | Held: The original supervision petition did not commence a judicial proceeding to contest validity; Charlotte did not timely commence a trust-contest |
| Whether SDCL 55-4-57(a)(1) is a statute of limitations or a statute of repose (impacting revival/relation-back) | Charlotte: It should be treated as a statute of limitations, allowing relation back | Trustees: It is a statute of repose that extinguishes the claim after the repose period | Held: SDCL 55-4-57(a)(1) operates as a statute of repose; the one-year bar extinguished the claim |
| Whether the relation-back doctrine permits Charlotte’s late amendment to relate back to her original petition | Charlotte: SDCL 15-6-15(c) supports relation back where amended claim arises from same conduct; affidavit and petition suffice | Trustees: The invalidity claim arises from earlier conduct (2014 amendment) and was not contained in the original petition; relation back cannot revive an extinguished claim | Held: Relation-back in SDCL 15-6-15(c) does not apply because the amended invalidity claim did not arise out of the same conduct/occurrence alleged in the original supervision petition; amendment was futile |
Key Cases Cited
- Ash v. Anderson Merchandisers, LLC, 799 F.3d 957 (8th Cir. 2015) (district court may deny leave to amend when amendment would be futile)
- Foman v. Davis, 371 U.S. 178 (U.S. 1962) (leave to amend should be freely given absent undue delay, bad faith, or futility)
- In re Elizabeth A. Briggs Revocable Living Tr., 898 N.W.2d 465 (S.D. 2017) (SDCL 55-4-57(a) applies to lack-of-capacity and undue-influence trust contests)
- Pitt-Hart v. Sanford USD Med. Ctr., 878 N.W.2d 406 (S.D. 2016) (statutory interpretation principles; plain meaning controls)
- Clark Cty. v. Sioux Equip. Corp., 753 N.W.2d 406 (S.D. 2008) (distinguishing statutes of limitations and statutes of repose)