In Bowen v. Bowen, 264 P.3d 233 (Utah App. 2011), the settlor established an irrevocable trust in 1982. In 2001, the settlor purported to amend the trust by removing the plaintiff and her brother as trust beneficiaries. The settlor died in 2002. The plaintiff did not learn of the amendment or the existence of the trust until 2006.
The Utah court of appeals first held that the equitable discovery rule tolled the running of the statute of limitations against the plaintiff until 2006. The court rejected the defendant’s argument that the plaintiff had constructive notice of the amendment because she had constructive notice of the existence of the trust in 1996 through publication of notice of a petition to appoint successor trustees. The court held that, in an action for breach of trust, the statute of limitations does not start to run until the beneficiary has, or can be charged with, knowledge that a breach has occurred.
The court further held that the 2001 purported amendment of the trust was invalid. The court cited the trust provisions that expressly declared the trust to be unamendable and irrevocable.
Finally, the court denied the defendant’s request that the trust be reformed to conform to the settlor’s revised intent as expressed in 2001, observing that reformation is available only in the case of mutual mistake or unilateral mistake coupled with fraud.
For a detailed discussion of the topics discussed in this blog post, see The Utah Law of Trusts & Estates, an online legal reference treatise available at The Utah Trust & Estate Educational Resource Center. Click on this link for a list of Utah statutes of limitations that relate to trust and estate matters.
Rust Tippett is the author of this blog post.
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This blog post in no way creates an attorney-client relationship between the reader and either Robert S. (Rust) Tippett or Bennett Tueller Johnson & Deere. The reader should consult with his or her own estate planning attorney regarding his or her particular circumstances.