Patterson v. Patterson - 2011 UT 68, 266 P.3d 828 (Sup.Ct.)

Rule:

Under Utah Code Ann. § 75-7-605 (Supp. 2011), a settlor may revoke or amend a revocable trust by substantially complying with a method provided in the terms of the trust. Alternatively, if the terms of a revocable trust do not provide a method for revocation or amendment that is expressly made exclusive, the settlor may amend or revoke the trust by any method manifesting clear and convincing evidence of the settlor's intent, § 75-7-605(3)(b)(ii).

Facts:

Shortly before she passed away in 2006, Darlene Patterson (Darlene) executed an amendment (the Amendment) to the Darlene Patterson Family Protection Trust (the Trust). The purpose of the Amendment was to remove Darlene's son, Ronald Patterson (Ron), as a beneficiary. Shortly after his mother passed away, Ron filed a lawsuit against the Trust and Darlene's estate in which he sought a declaration that the Amendment was void because it violated the terms of the Trust. On summary judgment, the district court invalidated the Amendment based on its interpretation of the Court’s opinion in Banks v. Means, 2002 UT 65, 52 P.3d 1190. According to the District Court, the Amendment was invalid because it attempted to completely divest Ron of his interest in the Trust without revoking the Trust, as required by Banks. The trustee, Randy Patterson appealed, arguing that the district court erred in deciding the case under Banks and in concluding that the Amendment was void. In the alternative, Randy asked the Court to apply a provision of the UUTC, which he contended has statutorily overruled Banks.

Issue:

1. Should the UUTC be the controlling statute in the case at bar?
2. Was the Amendment in question valid?

Answer:

1) Yes. 2) Yes.

Conclusion:

The Court reversed the district court's ruling granting Ron's motion for partial summary judgment, holding that the legislature effectively overruled Banks when it passed the UUTC; as such, the UUTC was the controlling statute in the present case. According to the Court, the UUTC sought to effectuate settlors’ intent by allowing for liberal amendment or revocation of revocable trusts. Applying the UUTC to the facts of the case, the Court held that Darlene’s Amendment was valid. The terms of the Trust did not specify an exclusive method for amendment or revocation and the Amendment constituted a clear expression of Darlene’s intent to terminate Ron’s interest.