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Koller v. Shaffer

Court of Appeals of Utah

February 15, 2018

Mark Koller, Appellee,
LuAnn K. Shaffer and Kathryn Prounis, Appellants.

         First District Court, Logan Department The Honorable Brandon J. Maynard No. 143100098

          M. Robert Smith and Christopher L. Daines, Attorneys for Appellant LuAnn K. Shaffer

          Matthew N. Evans and Matthew M. Cannon, Attorneys for Appellant Kathryn Prounis

          James K. Tracy, Robert S. Tippett, James C. Dunkelberger, and Trevor M. Crowley, Attorneys for Appellee

          Judge David N. Mortensen authored this Opinion, in which Judge Kate A. Toomey concurred. Judge Gregory K. Orme concurred in Sections II and III, and concurred in the result, without opinion, in Section I.

          MORTENSEN, Judge

         ¶1 Written instruments speak for themselves, and only specific exceptions to that general rule allow a court to look outside a document when interpreting it. The district court ruled that LuAnn K. Shaffer expressly resigned as trustee in writing. Because the district court properly interpreted the relevant provisions of a trust instrument and the associated resignation, we affirm its grant of summary judgment in favor of Mark Koller.[1]

         ¶2 Mark[2] brought this suit seeking a declaration that he was the rightful trustee of the Evan O. Koller Revocable Living Trust (the Trust). Evan O. Koller established the Trust in 2006, designating himself as both settlor and trustee of the Trust. Evan named LuAnn successor trustee, and the appointment was to be operative upon his "death, resignation or incapacity." In a proceeding not relevant to this appeal, Evan was declared incapacitated in 2006. Evan's children, [3] including Mark and LuAnn, stipulated to the appointment of a professional trustee in lieu of LuAnn accepting trusteeship. When the professional trustee resigned in 2009, LuAnn became trustee.

         ¶3 Around this same time, another of Evan's children, Kathryn Prounis, was serving as co-conservator of Evan's estate (the Estate) with her brother, Dan Koller. Kathryn informed LuAnn that the Estate was "out of money" and that "the co-conservators were trying to get a loan" from Lewiston State Bank (the Bank). The Bank insisted that the court appoint Kathryn and Dan as trustees of the Trust before it would consider the requested loan.

         ¶4 Kathryn was under the impression that she and Dan were already trustees by way of a prior stipulation among Evan's children. She nevertheless requested that LuAnn formally resign as trustee. On May 29, 2009, LuAnn signed a notarized document (the Resignation), stating, "I, LuAnn K. Shaffer, also known as LuAnn K. Nelson, hereby resign as successor trustee of [the Trust]." That same day, LuAnn delivered the Resignation to an employee of the Bank.

         ¶5 The Resignation contained no language making LuAnn's resignation conditional upon other events-such as the Estate obtaining the requested loan-but LuAnn contends that her intention in signing the Resignation was that it would be invalid if the loan was not approved. The loan request as it was originally framed-as a mortgage loan-was abandoned, but the Bank issued the Estate a line of credit five days after LuAnn signed the Resignation.

         ¶6 Several years later, Evan died. Prior to his death, Evan had signed an amendment to the trust instrument, specifying that "[u]pon the death, resignation or incapacity of LuAnn . . . as Trustee, the successor Trustee shall be Mark." After Evan's death, Mark received a copy of the Resignation from Dan. Believing that LuAnn had resigned as trustee, Mark sought appointment as successor trustee and initiated the present case in the district court.

         ¶7 LuAnn and Kathryn opposed Mark's efforts, arguing that LuAnn "never intended to resign nor has she ever resigned as trustee of" the Trust. However, the district court ultimately concluded that the Resignation spoke for itself and granted summary judgment in Mark's favor. The court appointed Mark as "the sole trustee" and concluded that he was authorized "to marshal the assets of [the Trust] . . . and all trusts created thereunder, and to administer such trust(s) according to its terms."

         ¶8 LuAnn appeals, [4] arguing that the district court erred in granting summary judgment. The errors she alleges all center on the question of whether the district court properly concluded that she had resigned as trustee; the basis of its decision to grant summary judgment to Mark. "We review the trial court's [grant of] summary judgment for correctness, considering only whether the trial court correctly applied the law and correctly concluded that no disputed issues of material fact existed." Hermansen v. Tasulis, 2002 UT 52, ¶ 10, 48 P.3d 235.

         ¶9 According to LuAnn, there are seven ways in which the district court erred in its conclusion that she resigned as successor trustee: (1) LuAnn never "legally resigned" as successor trustee; (2) the Resignation was to be held in escrow unless and until the Bank granted the mortgage loan, but the "mortgage loan transaction . . . was abandoned and never consummated, " leaving the Resignation "voided and destroyed and [with] no legal effect"; (3) the Bank's request for the Resignation was improper; (4) LuAnn never intended to resign unless the mortgage loan was granted; (5) she never delivered the Resignation to any beneficiary of the Trust; (6) no one relied upon the Resignation; and (7) "LuAnn at all relevant times acted as Trustee of the Trust." Mark counters that LuAnn "executed the Resignation, which unequivocally demonstrates her intent to resign as trustee of the Trust effective" on the date that the Resignation was signed. LuAnn insists that the district court should have considered extrinsic evidence before concluding that the Resignation established such an intent.

         ¶10 In our view, the arguments raised by the parties fit within three main categories: parol evidence, delivery, and factual ...

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