Larson, Matter of

• Citation: 341 N.W.2d 627
• Parties: In the Matter of the Administration by Franklin G. LARSON and Edson Germain Larson of the Trust Created by Enoch G. Larson Dated
• Decision Date: 14 October 1968
• Court: United States State Supreme Court of North Dakota

Page 627

341 N.W.2d 627

In the Matter of the Administration by Franklin G. LARSON and Edson Germain Larson of the Trust Created by Enoch G Larson Dated October 14, 1968 and of the Trust Created by Julia L. Larson Dated October 14, 1968.

Civ. Nos. 10486, 10487.

Supreme Court of North Dakota.

Dec. 22, 1983.

William J. Brudvik, Mayville, for appellant Edson Germain Larson; argued by William J. Brudvik, Mayville.

Nilles, Hansen, Magill & Davies, Fargo, for appellee Franklin G. Larson; argued by J. Gerald Nilles, Fargo.

ERICKSTAD, Chief Justice.

This case involves a disagreement between two co-trustees, Franklin G. Larson and Edson G. Larson, as to the manner of dividing farmland held in the Enoch G. Larson and the Julia L. Larson trusts. Franklin and two other trust beneficiaries, Carol Jean Carlisle and Elaine Kievman, petitioned the district court to divide the trust farmland into five separate parcels and to allocate the trust assets, including the divided farmland, to five trust shares, one for each beneficiary. Edson opposed the petition on the ground that the trust settlors intended the trustees to allocate equal undivided interests in the farmland rather than individual tracts to each trust share. The district court concluded that the trust instruments clearly and unambiguously:

"... provide for the division of the trust estate into 5 separate trusts and that such division includes whatever property, including specific farmland to be allocated to each trust share."

Consistent with that interpretation the court entered an order, dated April 27, 1983, by which it divided the trust farmland into five separate parcels and allocated the divided trust assets to each of the five designated trust shares.

Edson filed this appeal from the court's order through which he has raised one issue:

"Did the trial court err in ordering the division of the Enoch G. Larson and Julia L. Larson Trusts into five separate trusts and the allocation of specific tracts of farmland to each trust so created?"

When the district court was petitioned to order a division of the property it was faced with a situation where the co-trustees, Edson and Franklin, while in agreement that the trust instruments directed them to place the trust assets into five trust shares, could not agree on the method of allocating the trust farmland. Faced with that situation, the district court allocated specific tracts of farmland to each of the five trust shares. We are asked to determine whether or not the district court acted properly and within its authority. We conclude that it did.

Section 59-02-11, N.D.C.C., provides that where there are several co-trustees "all must unite in any act to bind the trust property, unless the declaration of trust provides otherwise." Section 59-02-12, N.D.C.C., provides that a discretionary power conferred upon a trustee "shall be controlled by the district court if not reasonably exercised, unless an absolute discretion clearly is conferred by the declaration of trust." Under Section 59-04-02, N.D.C.C., the district court, upon proper petition, has the authority to supervise the administration of a trust. We believe the foregoing provisions, when construed together, authorize the district court to direct an appropriate course of action, in accordance with the terms of the trust, when the co-trustees cannot agree on the course to follow.

The situation in this case is analogous to that in Conway v. Parker, 250 N.W.2d 266 (N.D.1977), wherein one co-executrix wanted to execute a power of attorney and the other did not. In affirming the district court's order requiring the co-executrixes to execute the power of attorney, this Court stated in relevant part:

"The statute clearly requires joint action by corepresentatives whenever circumstances permit. Such joint action was not present or forthcoming from Parker and Conway. The district court was confronted with the question of what, if any, alternatives were available aside from continued impasse.

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"We hold that the district court was authorized to and, properly, did require that a power of attorney be executed to Brady & Co., notwithstanding lack of concurrence on this issue by the corepresentatives. Although joint action is the goal of the Uniform Probate Code, as evidenced by Sec. 30.1-18-17, NDCC, set out previously, failure of the representatives to agree cannot be allowed to result in stalemate of administration of the estate." (Footnote omitted). 250 N.W.2d at 271-72.

In Conway, supra, we held that the district court had authority to resolve a dispute between co-executrixes on a matter of estate administration, under the Uniform Probate Code provisions authorizing the court to control the actions of personal representatives to prevent the jeopardizing of another's interest in the estate. Similarly, we conclude that the authority vested in the district court to control trust administration under Sections 59-02-12, N.D.C.C., and 59-04-02, N.D.C.C., permits the district court to resolve a stalemate situation caused by the inability of co-trustees to act in concert on a matter of trust administration.

Edson does not dispute the court's decision to create five separate trust shares, one for each beneficiary, nor does Edson dispute the particular share allocations which were designated by the court to each of the beneficiaries. The sole basis for Edson's appeal is the decision of the court to divide and allocate separate tracts of farmland to each trust share rather than to...