District Court, St. George Department The Honorable G.
Michael Westfall No. 060501773
William F. Rummler and Christopher A. Lund, Attorneys for
Nicholas I. Chamberlain, Attorney for Appellees
Kate A. Toomey authored this Opinion, in which Judges Michele
M. Christiansen and David N. Mortensen concurred.
The Beneficiaries of the Terrestrial Kingdom of God Trust
appeal the orders of the district court granting summary
judgment in favor of Penn Smith and Valden Cram. We affirm in
part and reverse in part.
Steven E. Kirkland (the Trustor) created the Terrestrial
Kingdom of God Trust (the Trust) in 1993 and named several
relatives as Beneficiaries.
The Trustor appointed Valden Cram and Penn Smith as two of
the original Trustees in 1993. The Trust required the Trustor
to "prepare and deliver" Lease and Stewardship
Agreements, signed by the Trustor and the Trustees, to the
Beneficiaries. The Trustor did not deliver these agreements
before he died. Instead, the Trustees delivered the
agreements and the Trust has been functioning since 1993.
The Declaration of Trust designated that the Trustees would
serve without pay, but it allowed the Trustees to appoint one
person as manager who was to be paid "reasonable
compensation" as determined by the Board of Trustees. In
2005, the Board amended the Declaration of Trust to include
four paid positions, including a manager and an assistant
manager who would each be paid $50 an hour. In 2006, the
Board appointed Smith as manager and Cram as assistant
manager, and they began charging the Trust for their
In September 2006, a board of arbitration determined that the
Trust permitted the appointment of a trust manager, but that
it was "gross negligence" for the Trustees to
appoint themselves to paid positions and that such action was
in breach of the basic intent of the Trust. The 2006
Arbitration Board also indicated that some actions taken by
Smith as manager were outside of his assigned functions, and
that Smith was "grossly negligent" for attempting
to deal with these matters and charging the Trust for the
time spent on them.
Two weeks later, Smith filed a lawsuit against the Trust,
seeking compensation for his services. Cram, representing the
Trust, was listed as a defendant. Smith did not inform the
Beneficiaries of his intentions to sue. Because the suit went
unopposed, default judgment was entered and Smith placed a
lien on Trust property. Cram did not inform the Beneficiaries
of the property lien. After learning of the default judgment,
the Beneficiaries intervened in the lawsuit and filed a
complaint against Smith and Cram (collectively, the
Appellees), claiming various breaches of fiduciary
duties and conversion of Trust assets.
The dispute between the Beneficiaries and the Appellees went
before another arbitration board in 2007. The 2007
Arbitration Board concluded that "the Trustees have
acted in the best interest of the Trust" but concluded
that the "matters dealing with facts in controversy
between the Trustees . . . and the Trust Beneficiaries are
being adjudicated by all parties in the . . . 5th District
Court and final judgment of that controversy should be left
to that court."
¶8 Litigation continued over the course of the next six
years, with several notable developments. In April 2008, the
Beneficiaries filed motions to remove the Appellees as
Trustees for breaches of fiduciary duty and to void their
allegedly self-serving transactions. The district court
granted those motions. Over a year later, the court, without
explanation, set aside its order granting the motions.
In May 2013, the Appellees filed a motion for summary
judgment, claiming that the Trust was valid, that Smith was
entitled to compensation, and that the Trustees did not
breach their fiduciary duties. The district court granted
summary judgment on the validity issue, but denied summary
judgment on the breach and compensation issues, concluding
there were "genuine issues of material fact"
regarding "the amount, if any, to which [Smith] is
entitled for his work as Manager" and regarding whether
the Trustees have "breached their various duties to the
Beneficiaries." The court reserved these issues for
Forty-five days later, the Appellees filed another motion for
summary judgment on the same breach and compensation issues.
No further discovery had taken place, and the Appellees
included only two additional documents in support of this
second motion for summary judgment.
The Beneficiaries filed a motion to strike the Appellees'
second motion for summary judgment, arguing the law of the
case doctrine precluded the Appellees from reopening the same
issues on a second motion for summary judgment. The
Beneficiaries also argued that the two additional documents
were inadmissible hearsay. The Beneficiaries mistakenly
believed that their motion to strike stayed the time to
submit an opposition to the motion for summary judgment, and
they filed no opposition to it.
In November 2013, three months after the Appellees filed
their second motion for summary judgment, the district court
held a pretrial conference. The court heard oral argument on
the motion to strike and the motion for summary judgment, and
granted the motion for summary judgment in its entirety,
which included an award of attorney fees. The Beneficiaries
filed a motion to reconsider and two rule 60(b) motions for
relief from judgment, each of which was denied. The
The Beneficiaries raise four issues on appeal. First, they
contend the district court erred when it granted the
Appellees' second motion for summary judgment. Second,
the Beneficiaries argue the court abused its discretion by
denying their first rule 60(b) motion. Third, they contend
that the court's award of attorney fees to the Appellees
was improper. Fourth, they argue the court erred when, on the
first motion for summary ...