UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA
______________________________ ) KAREN A. DERRINGER, et al., ) ) Plaintiffs, ) ) v. ) Civil Action No. 09-1979 (RWR) ) MARIANNE EMERSON, et al., ) ) Defendants. ) ______________________________)
MEMORANDUM OPINION
Plaintiffs Karen A. Derringer and Sanna Lee Solem (“Sanna
Lee”) bring this action against Marianne Emerson and the Ray
Solem Charitable Foundation (“the Foundation”) involving a
dispute over their father’s living trust. The defendants have
moved to dismiss the action, arguing, in part, that the
plaintiffs’ action is barred by Virginia’s two-year statute of
limitations on actions contesting a will. Because Derringer and
Sanna Lee have effectively contested the trust by requesting
declaratory relief that would invalidate amendments made to their
father’s trust, and the contest is barred by Virginia’s two-year
statute of limitations, the defendants’ motions to dismiss,
treated as motions for summary judgment, will be granted.
BACKGROUND
On February 6, 2004, Richard Ray Solem (“Solem”),
Derringer’s and Sanna Lee’s father and Emerson’s common law
husband (Am. Compl. ¶ 9), created a living trust for the - 2 -
administration of all of his assets, both during his life and
upon his death. (Id. ¶ 8; see also Ex. 1.) It initially named
Derringer and Sanna Lee as beneficiaries of his estate, and
allocated to them upon his death between $2,000,000 and
$4,000,000 of trust assets, with the remaining assets distributed
to the Foundation. (Id. ¶¶ 10-11, Ex. 1 at 8-2.) The trust’s no
contest clause states that
[i]f any person, including a beneficiary . . . shall in any manner, directly or indirectly, attempt to contest or oppose the validity of this agreement, including any amendments thereto, or commences or prosecutes any legal proceedings to set this agreement aside, then . . . such person shall forfeit his or her share, cease to have any right or interest in the trust property, and shall be deemed to have predeceased me.
(Id., Ex. 1 at 18-6.)
The trust designated Solem as its trustee and Derringer as a
successor trustee in the event of Solem’s death or mental
incompetence. (Id., Ex. 1 at 1-1, 15-2 - 15-3.) On
September 27, 2004, however, Solem signed a memorandum (“the
Memorandum”) entitled “Modifications in Richard Ray Solem Living
Trust” directed to Emerson and his lawyer, expressing his
decision to remove Derringer as a successor trustee to his trust
and to transfer all of his trust assets to the Foundation upon
his death. (Id. ¶ 14, Ex. 3.) Solem stated that he “no longer
trust[ed] . . . [Derringer] to responsibly act as successor
trustee” and “[did] not wish to name [his] daughters as
beneficiaries of [his] estate[.]” (Id., Ex. 3.) On - 3 -
September 29, 2004, Solem executed a notarized summary (“the
Summary”) memorializing his intentions regarding his trust
amendment. (Id. ¶ 14, Ex. 2.) In the Summary, Solem named
Emerson as the successor trustee to his trust, and, if Emerson
was unable to serve, Sanna Lee as the next successor trustee, and
named the Foundation as the trust’s beneficiary. (Id., Ex. 2
¶¶ 4, 6.) Both Derringer and Sanna Lee were aware that
modifications had been made to the trust as of January 2006. In
an email dated April 6, 2005, Solem told Derringer that he had
“made alternative arrangements for his estate” (Defs.’ Mem. of P.
& A. in Supp. of Mot. to Dismiss (“Defs.’ Mem.”), Ex. 2, Att. A),
and Sanna Lee sent an email to Emerson on January 12, 2006
stating that she understood that her father had removed her from
his will, but questioned whether money had been set aside for her
for specific purposes. (Id., Ex. 2, Att. B.)
Solem died on January 4, 2006. (Am. Compl., Ex. 4; Defs.’
Mem. at 2, Ex. 1.) On October 14, 2009, Derringer and Sanna Lee
filed this action. Their amended complaint seeks declaratory
relief regarding the terms of the trust. The defendants move to
dismiss under Federal Rule of Civil Procedure 12(b)(6), arguing
that Derringer and Sanna Lee’s action amounts to a trust contest
and is barred by Virginia’s two-year statute of limitations.
Plaintiffs oppose the defendants’ motions. - 4 -
DISCUSSION
A motion to dismiss for failure to state a claim may be
granted where a complaint, construed in the light most favorable
to the plaintiff, does not allege sufficient facts to support a
claim. See Bell Atl. Corp. v. Twombly, 550 U.S. 544, 556 (2007).
“‘A defendant may raise the affirmative defense of statute of
limitations via a Rule 12(b)(6) motion when the facts that give
rise to the defense are clear from the face of the complaint.’”
Perry v. Scholar, 696 F. Supp. 2d 91, 95 (D.D.C. 2010) (quoting
Turner v. Afro-American Newspaper Co., 572 F. Supp. 2d 71, 72
(D.D.C. 2008)). When considering
a motion to dismiss under Rule 12(b)(6) asserting a statute of limitations bar, where both parties submit material outside the pleadings and “the parties are not taken by surprise or deprived of a reasonable opportunity to contest facts averred outside the pleadings and the issues involved are discrete” legal issues, the court may convert the motion to a motion for summary judgment “without providing notice or the opportunity for discovery to the parties.”
Highland Renovation Corp. v. Hanover Ins. Group, 620 F. Supp. 2d
79, 82 (D.D.C. 2009) (quoting Tunica-Biloxi Tribe of La. v. United
States, 577 F. Supp. 2d 382, 405 (D.D.C. 2008)). Because both
sides have submitted exhibits outside the pleadings, and the
exhibits have not been excluded by the court, the defendants’
motions will be treated as motions for summary judgment. Summary
judgment may be granted where the moving party demonstrates that
there is no genuine issue of material fact and the moving party is
entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c). - 5 -
A genuine issue of material fact is presented where a “reasonable
jury could return a verdict for the non-moving party.” Anderson
v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
Under Virginia law, “a resort to the means provided by law
for attacking the validity of a will amounts to a contest[.]”
Womble v. Gunter, 95 S.E.2d 213, 219 (Va. 1956) (internal
quotation marks omitted). A party contests the validity of a
will1 when it challenges the will on grounds of lack of
testamentary capacity, fraud, undue influence, improper execution,
forgery, or subsequent revocation by a later will. See id. at
216. This list, however, is not exhaustive. See In re Rohrbaugh,
Nos. FI 2002-68397, CL 2009-16701, 2010 WL 1805359, at *8 n.10
(Va. Cir. Mar. 31, 2010) (noting that Womble did not expressly
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UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA
______________________________ ) KAREN A. DERRINGER, et al., ) ) Plaintiffs, ) ) v. ) Civil Action No. 09-1979 (RWR) ) MARIANNE EMERSON, et al., ) ) Defendants. ) ______________________________)
MEMORANDUM OPINION
Plaintiffs Karen A. Derringer and Sanna Lee Solem (“Sanna
Lee”) bring this action against Marianne Emerson and the Ray
Solem Charitable Foundation (“the Foundation”) involving a
dispute over their father’s living trust. The defendants have
moved to dismiss the action, arguing, in part, that the
plaintiffs’ action is barred by Virginia’s two-year statute of
limitations on actions contesting a will. Because Derringer and
Sanna Lee have effectively contested the trust by requesting
declaratory relief that would invalidate amendments made to their
father’s trust, and the contest is barred by Virginia’s two-year
statute of limitations, the defendants’ motions to dismiss,
treated as motions for summary judgment, will be granted.
BACKGROUND
On February 6, 2004, Richard Ray Solem (“Solem”),
Derringer’s and Sanna Lee’s father and Emerson’s common law
husband (Am. Compl. ¶ 9), created a living trust for the - 2 -
administration of all of his assets, both during his life and
upon his death. (Id. ¶ 8; see also Ex. 1.) It initially named
Derringer and Sanna Lee as beneficiaries of his estate, and
allocated to them upon his death between $2,000,000 and
$4,000,000 of trust assets, with the remaining assets distributed
to the Foundation. (Id. ¶¶ 10-11, Ex. 1 at 8-2.) The trust’s no
contest clause states that
[i]f any person, including a beneficiary . . . shall in any manner, directly or indirectly, attempt to contest or oppose the validity of this agreement, including any amendments thereto, or commences or prosecutes any legal proceedings to set this agreement aside, then . . . such person shall forfeit his or her share, cease to have any right or interest in the trust property, and shall be deemed to have predeceased me.
(Id., Ex. 1 at 18-6.)
The trust designated Solem as its trustee and Derringer as a
successor trustee in the event of Solem’s death or mental
incompetence. (Id., Ex. 1 at 1-1, 15-2 - 15-3.) On
September 27, 2004, however, Solem signed a memorandum (“the
Memorandum”) entitled “Modifications in Richard Ray Solem Living
Trust” directed to Emerson and his lawyer, expressing his
decision to remove Derringer as a successor trustee to his trust
and to transfer all of his trust assets to the Foundation upon
his death. (Id. ¶ 14, Ex. 3.) Solem stated that he “no longer
trust[ed] . . . [Derringer] to responsibly act as successor
trustee” and “[did] not wish to name [his] daughters as
beneficiaries of [his] estate[.]” (Id., Ex. 3.) On - 3 -
September 29, 2004, Solem executed a notarized summary (“the
Summary”) memorializing his intentions regarding his trust
amendment. (Id. ¶ 14, Ex. 2.) In the Summary, Solem named
Emerson as the successor trustee to his trust, and, if Emerson
was unable to serve, Sanna Lee as the next successor trustee, and
named the Foundation as the trust’s beneficiary. (Id., Ex. 2
¶¶ 4, 6.) Both Derringer and Sanna Lee were aware that
modifications had been made to the trust as of January 2006. In
an email dated April 6, 2005, Solem told Derringer that he had
“made alternative arrangements for his estate” (Defs.’ Mem. of P.
& A. in Supp. of Mot. to Dismiss (“Defs.’ Mem.”), Ex. 2, Att. A),
and Sanna Lee sent an email to Emerson on January 12, 2006
stating that she understood that her father had removed her from
his will, but questioned whether money had been set aside for her
for specific purposes. (Id., Ex. 2, Att. B.)
Solem died on January 4, 2006. (Am. Compl., Ex. 4; Defs.’
Mem. at 2, Ex. 1.) On October 14, 2009, Derringer and Sanna Lee
filed this action. Their amended complaint seeks declaratory
relief regarding the terms of the trust. The defendants move to
dismiss under Federal Rule of Civil Procedure 12(b)(6), arguing
that Derringer and Sanna Lee’s action amounts to a trust contest
and is barred by Virginia’s two-year statute of limitations.
Plaintiffs oppose the defendants’ motions. - 4 -
DISCUSSION
A motion to dismiss for failure to state a claim may be
granted where a complaint, construed in the light most favorable
to the plaintiff, does not allege sufficient facts to support a
claim. See Bell Atl. Corp. v. Twombly, 550 U.S. 544, 556 (2007).
“‘A defendant may raise the affirmative defense of statute of
limitations via a Rule 12(b)(6) motion when the facts that give
rise to the defense are clear from the face of the complaint.’”
Perry v. Scholar, 696 F. Supp. 2d 91, 95 (D.D.C. 2010) (quoting
Turner v. Afro-American Newspaper Co., 572 F. Supp. 2d 71, 72
(D.D.C. 2008)). When considering
a motion to dismiss under Rule 12(b)(6) asserting a statute of limitations bar, where both parties submit material outside the pleadings and “the parties are not taken by surprise or deprived of a reasonable opportunity to contest facts averred outside the pleadings and the issues involved are discrete” legal issues, the court may convert the motion to a motion for summary judgment “without providing notice or the opportunity for discovery to the parties.”
Highland Renovation Corp. v. Hanover Ins. Group, 620 F. Supp. 2d
79, 82 (D.D.C. 2009) (quoting Tunica-Biloxi Tribe of La. v. United
States, 577 F. Supp. 2d 382, 405 (D.D.C. 2008)). Because both
sides have submitted exhibits outside the pleadings, and the
exhibits have not been excluded by the court, the defendants’
motions will be treated as motions for summary judgment. Summary
judgment may be granted where the moving party demonstrates that
there is no genuine issue of material fact and the moving party is
entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c). - 5 -
A genuine issue of material fact is presented where a “reasonable
jury could return a verdict for the non-moving party.” Anderson
v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
Under Virginia law, “a resort to the means provided by law
for attacking the validity of a will amounts to a contest[.]”
Womble v. Gunter, 95 S.E.2d 213, 219 (Va. 1956) (internal
quotation marks omitted). A party contests the validity of a
will1 when it challenges the will on grounds of lack of
testamentary capacity, fraud, undue influence, improper execution,
forgery, or subsequent revocation by a later will. See id. at
216. This list, however, is not exhaustive. See In re Rohrbaugh,
Nos. FI 2002-68397, CL 2009-16701, 2010 WL 1805359, at *8 n.10
(Va. Cir. Mar. 31, 2010) (noting that Womble did not expressly
state or imply that lack of testamentary capacity, fraud, undue
influence, improper execution, forgery, or subsequent revocation
by a later will were the only grounds that constitute a will
contest). The question of whether an action seeking
interpretation of a will’s provisions constitutes a contest
depends largely on the language of the will’s forfeiture or no
contest clause and “the facts and circumstances of each particular
1 Because Solem’s trust provisions outlined the distribution of his property after his death (see Am. Compl., Ex. 1), the trust provisions should be interpreted in the same way as those appearing in wills. See, e.g., Keener v. Keener, 682 S.E.2d 545, 548 (Va. 2009) (noting that where a testator relies on a trust for the disposition of property after death, the same principles of forfeiture and contestation that apply to wills apply to the trust). - 6 -
case.” Va. Found. of Indep. Colls. v. Goodrich, 436 S.E.2d 418,
420 (Va. 1993) (emphasis in original) (internal quotation marks
omitted). Generally, an action that would thwart the purpose of
the will constitutes a contest to its validity. See Keener v.
Keener, 682 S.E.2d 545, 549 (Va. 2009).
The amended complaint questions whether the Summary and
Memorandum amended Solem’s trust (see Am. Compl. ¶ 15 (“[T]he
central issue . . . is whether these two documents somehow amended
or revised the Living Trust[.]”) and seek an order declaring that
the living trust was not amended by the Summary and Memorandum.
(Id. ¶ 23.) “In questions of trust interpretation, the ‘plain
language of the instrument controls a court’s inquiry.’” In re
Rudwick, No. 01-633, 2002 WL 31730757, at *2 (Va. Cir. Ct. Dec. 5,
2002) (quoting NationsBank of Va., N.A. v. Estate of Grandy, 450
S.E.2d 140, 143 (Va. 1994)). In his trust, Solem expressly
retained “the absolute right to amend or revoke [the] trust, in
whole or in part, at any time.” (Am. Compl., Ex. 1 at 4-2 ¶ d.)
The trust states that “[a]ny amendment or revocation must be
delivered to [the] Trustee in writing.” (Id.) At the time Solem
executed the Summary and Memorandum, he was the Trustee. (Id.,
Ex. 1 at 1-1.) Thus, under the plain language of the trust
instrument, Solem only had to put in writing his amendments to
render them effective. Solem wrote and signed both the Summary
and Memorandum. - 7 -
Although the plaintiffs’ brief claims that the plaintiffs “do
not question the validity of the Summary and Memorandum” (Pls.’
Opp’n to Def. Ray Solem Charitable Foundation’s Mot. to Dismiss
the First Am. Compl. at 6), the amended complaint nonetheless
seeks a judgment declaring that (1) the Living Trust was not
amended, (2) assets up to $2,000,000 should be distributed to
them, (3) they are trustees of the Foundation, (4) any assets
beyond $2,000,000 should be distributed to the Foundation, and (5)
the Foundation shall return $2,000,000 in assets to the living
trust. (Am. Compl. ¶ 23.) By requesting a judgment declaring
that the trust was never amended, the plaintiffs do not merely
seek an interpretation of the trust amendments, but they also seek
invalidation of the amendments. Because the relief sought would
directly oppose the validity of the trust amendments –- an action
expressly prohibited by the trust’s no contest clause –- it
amounts to a trust contest.
Under Virginia law, a person may file an action regarding the
validity of a trust up to two years after the settlor’s death or
six months after the trustee sent the party a copy of the trust
instrument.2 Va. Code Ann. § 55-546.04. The plaintiffs filed
this action almost four years after Solem’s death and nearly two
years after Virginia’s statute of limitations ran. The action,
2 The six-month provision does not apply here because the record does not reflect that any trust instrument was formally delivered to the plaintiffs. - 8 -
therefore, is untimely. Because there are no material facts in
dispute and the defendants are entitled to judgment as a matter of
law, the defendants’ motions to dismiss, treated as motions for
summary judgment, will be granted.
CONCLUSION
Because the plaintiffs’ action contests the trust but was
filed beyond Virginia’s applicable two-year statute of limitations
for such an action, the defendants’ motions, treated as motions
for summary judgment, will be granted. A separate Order
accompanies this Memorandum Opinion.
SIGNED this 6th day of August, 2010.
/s/ RICHARD W. ROBERTS United States District Judge