In the Matter of the Estate of James Edwin Ibeling

• Court: Supreme Court of Iowa
• Decided: May 1, 2026
• Docket: 24-1139
• Status: Published

Opinion

In the Iowa Supreme Court

No. 24–1139

Submitted March 25, 2026—Filed May 1, 2026

In the matter of the Estate of James Edwin Ibeling.

Nancy Ibeling,

Appellant.

On review from the Iowa Court of Appeals.

Appeal from the Iowa District Court for Polk County, Katie Ranes, district

associate probate judge.

A surviving spouse seeks further review from a court of appeals decision

holding that assets transferred to a Panamanian private interest foundation

founded by her husband are not included in the elective share under Iowa Code

section 633.238(1)(d)(1). Decision of Court of Appeals and District Court

Judgment Affirmed.

McDonald, J., delivered the opinion of the court, in which Oxley,

McDermott, and May, JJ., joined. Mansfield, J., filed a dissenting opinion, in

which Christensen, C.J., and Waterman, J., joined.

Gary Dickey (argued) of Dickey, Campbell & Sahag Law Firm, PLC,

Des Moines, and Dallas J. Janssen of Janssen Law, PLC, Des Moines, for

Matthew G. Sease (argued) of Sease & Wadding, Des Moines, for appellee. 2

McDonald, Justice.

The surviving spouse of a decedent may elect to claim a share of statutorily

“limited” property of the decedent against the decedent’s will, including one third

of the value of the decedent’s property held in a revocable trust. Iowa Code

section 633.238(1)(d)(1) (2021). The question presented in this appeal is whether

the statutory provision creating the right to take an elective share of such

property is applicable to property held by a distinct legal entity that is not a

revocable trust but shares some of the same characteristics as a revocable trust.

I.

In December 2013, James Ibeling contacted a lawyer in Panama, Carlos

Eduardo Varela Cardenal, in connection with a real estate development project.

James asked Cardenal to establish a private interest foundation (PIF) pursuant

to Panama’s Law No. 25 of June 12, 1995. The foundation was named the

Harris 6 Foundation. Harris 6 was registered with the Republic of Panama in

January 2014. James was both the founder of Harris 6 and the main beneficiary

during his lifetime.

In the event of James’s death, the PIF regulations directed that the

foundation assets be passed to the substitute beneficiaries in equal parts. The

regulations listed four substitute beneficiaries: a testamentary charitable

foundation named the James Ibeling Foundation; James’s longtime personal

assistant and bookkeeper, Lisa Mengwasser; James’s nephew; and a minor from

Arizona whom James considered a friend and who is also named as a beneficiary

in James’s will, Deyon Rashad Harris. According to the foundation charter, the

purpose of the PIF was to “cover the costs of education, training, equipment, aid,

as well as the general maintenance or other similar purposes of one or more

members of one or more families specified” and to “benefit other natural or legal 3

persons or institutions of any nature and take the necessary provisions for the

orderly succession of their assets.”

James did not transfer any assets into the PIF at the time of its creation,

and it remained unfunded for the next five years. In August 2019, James

reconnected with Cardenal because he wanted to transfer assets to the PIF.

James’s assistant communicated to Cardenal that “[t]he purpose of transferring

assets into the Foundation [was] because Jim [was] considering getting married

(without a prenup) and want[ed] to protect his assets.” James conveyed twelve

properties in Arizona to the PIF by warranty deeds. Under Panamanian law,

Harris 6 was the owner of the properties. The warranty deeds were recorded on

August 23. Three days later, on August 26, James married Nancy.

James died on February 17, 2021. He was seventy-five years old. At the

time of James’s death, Harris 6 owned ten Arizona properties. Mengwasser was

the executor of James’s estate, and she testified that some of the properties were

in the process of being sold to satisfy James’s debts. She estimated that three

properties would remain in Harris 6 by the time the debts were settled and that

the value of those three properties would be at or above $1.1 million.

Nancy filed for an elective share of James’s estate against James’s will

pursuant to Iowa Code section 633.238. As relevant here, that statute provides:

One-third in value of the property held in trust not necessary for the payment of debts and charges over which the decedent was a settlor and retained at the time of death the power to alter, amend, or revoke the trust, or over which the decedent waived or rescinded any such power within one year of the date of death, and to which the surviving spouse has not made any express written relinquishment . . . .

Iowa Code § 633.238(1)(d)(1).

The guardian ad litem for the minor beneficiary, Harris, filed an

application for a declaratory judgment seeking a declaration that the PIF assets 4

were not included in Nancy’s spousal share. At the hearing on the declaratory

judgment action, the guardian ad litem called an expert on Panamanian PIFs,

Juan Pablo Fábrega Polleri. Fábrega Polleri testified that PIFs are not trusts.

Fábrega Polleri testified that a PIF “is a legal entity with existence of its own and

with capacity to be subject of rights and to enter into obligations as an individual

or as a corporation that gained . . . its legal existence by virtue of the registration

of its foundation charter in the public registry of Panama.” He next explained the

process to create a PIF:

An individual signs, executes a charter. That document is notarized following Panama’s regulation. It’s notarized into public deed before a notary public in Panama. You take that public deed to the public registry, and the public registry registers that document.

....

. . . [T]he foundation then once registered it has its own legal capacity to exercise rights and to acquire obligations under the same circumstances that a natural or physical person would as well as a type of -- any other type of legal entity.

Even though the founder is the creator of the foundation, it is the foundation council as an administrative organ of the legal entity who manages and disposes of the assets of the foundation, as per the provisions set out by the founder in the foundation charter or its bylaws which regulate, you know, further regulate the foundation charter.

Fábrega Polleri acknowledged that there are similarities between trusts and PIFs,

for example, “both are vehicles used primarily for family and estate planning.”

He explained that “[w]ith a trust and a [PIF], the settlor and the founder

respectively can arrange, in any orderly manner and without having to go

through an inheritance process, a transfer of his/her estate to his or her heirs.”

He explained that despite the similarities, PIFs are distinct from trusts, which

also exist in Panama and are governed by a different set of laws. 5

Cardenal, James’s Panamanian attorney, also testified at the hearing. He

testified that he created Harris 6 for James and that he understood that James

wanted to create the PIF to shield his assets from a potential spousal claim. He

testified that James conveyed the Arizona properties to the PIF and that they

were to be held in the PIF for James’s benefit during James’s lifetime.

The probate court granted the application for declaratory judgment. The

court identified several features of a PIF that make it distinguishable from a

revocable trust. First, the court recognized that, under Panamanian law, a PIF

is a distinct legal entity, much like a corporation. Assets in a PIF are owned by

the PIF, not the founder, “protector,” or “council” of the foundation. Similarly,

the court noted that James’s personal debts cannot be satisfied by the PIF assets

under Panamanian law. They are completely separate. Again, more like a

corporation than a trust, a PIF is required to obtain its own tax identification

status in Panama. The court relied heavily on the statutory language of Iowa

Code section 633.238, emphasizing that the elective share is “limited to” the

categories of property specifically enumerated in the statute. The court further

rejected Nancy’s argument that defects in the administration of the PIF,

including the existence of mortgages, warranted disregarding the foundation

altogether.

Nancy timely appealed, and we transferred the case to the court of appeals.

The court of appeals, relying on In re Estate of Myers, 825 N.W.2d 1, 3

(Iowa 2012), affirmed that a PIF is not a revocable trust and, thus, is not in the

listed assets under section 633.238(1) that are subject to Nancy’s elective share.

Nancy sought further review from our court, which we granted. 6

II.

Probate actions are tried in equity and are usually reviewed de novo. See

Myers, 825 N.W.2d at 3. However, “when there are no disputed facts and the

appeal turns on whether the probate court’s interpretation of a statute was

erroneous, . . . our review is for correction of errors of law.” Id. at 3–4. This case

presents a question of law, one of statutory interpretation.

As with all questions of statutory interpretation, we begin with the text of

the statute at issue. See State v. Brown, 16 N.W.3d 288, 296 (Iowa 2025). Iowa

Code section 633.238 creates a limited statutory right for a surviving spouse to

elect to take a share of certain property against a decedent spouse’s will. That

section provides:

1. The elective share of the surviving spouse shall be limited to all of the following:

a. One-third in value of all the legal or equitable estates in real property possessed by the decedent at any time during the marriage which have not been sold on execution or other judicial sale, and to which the surviving spouse has made no express written relinquishment of right, including but not limited to any relinquishments of rights described in paragraph “d”.

b. All personal property that, at the time of death, was in the hands of the decedent as the head of a family, exempt from execution.

c. One-third of all personal property of the decedent that is not necessary for the payment of debts and charges.

d. (1) One-third in value of the property held in trust not necessary for the payment of debts and charges over which the decedent was a settlor and retained at the time of death the power to alter, amend, or revoke the trust, or over which the decedent waived or rescinded any such power within one year of the date of death, and to which the surviving spouse has not made any express written relinquishment in compliance with subparagraph (2).

Iowa Code § 633.238(1). 7

The parties dispute whether subsection (d) applies only to property held in

a revocable trust or whether it should be read more broadly to include property

owned by an entity that shares some legal characteristics of a revocable trust

but is not a revocable trust. We conclude the better interpretation and

construction of the statute is that section 633.238(1)(d) includes only property

held in a revocable trust (or in a trust converted from a revocable to an

irrevocable trust within a year of the decedent’s death) governed by trust law and

not property held by a separate legal entity governed by a different body of law.

We reach that conclusion based on the ordinary meaning of the legal terms used

in the statute when the statute is read as a whole and read in light of the relevant

law. See Cnty. Bank v. Shalla, 20 N.W.3d 812, 818 (Iowa 2025) (stating the court

must determine the ordinary meaning of the statute when the statute is read “as

a whole and in context” rather than “just isolated words and phrases” (quoting

Doe v. State, 943 N.W.2d 608, 610 (Iowa 2020))).

The text of the statute creates but strictly limits the statutory right. The

statute provides that the elective share “shall be limited to all of the following.”

Iowa Code § 633.238(1) (emphasis added). The statute then lists four specific

categories of property. See id. “It is clear that the legislature, by this language,

intended to limit the property that would be included in the surviving spouse’s

elective share to the four categories of property specifically identified in the

statute.” Myers, 825 N.W.2d at 6; id. at 8 (“[O]nly the assets specifically

enumerated in section 633.238 may be included in the surviving spouse’s

elective share.”). Thus, the list is exclusive, not inclusive; exhaustive, not

illustrative. See Hawkeye Land Co. v. Iowa Utilities Bd., 847 N.W.2d 199, 215

(Iowa 2014) (explaining that the legislature knows how to create an open list if it

wants to do so). It is not the province of this court to expand the legislature’s 8

limited list of property subject to the elective share under the guise of

interpretation and construction. See Sallee v. Stewart, 827 N.W.2d 128, 150

(Iowa 2013) (stating that, absent expansive language, “[t]he legislature clearly

has not empowered this court to expand or update the [statutory] list”).

Property owned by a PIF is not one of the four categories of property

identified in the statute. An argument could be made that the status of the entity

that owns or holds the property is not relevant because the first part of the

statute states it applies to property “held in trust.” Iowa Code § 633.238(1)(d)(1).

That argument ignores, however, the second portion of the statute, which

discusses property “held in a trust” and when the decedent created “the trust.”

Id. § 633.238(1)(d)(2) (emphasis added). The statute discusses transfers of real

property into a “revocable trust” by a “settlor,” and it refers to a “trustee of the

revocable trust.” Id. § 633.238(2). The statute’s repeated use of the terms

“settlor,” “trustee,” “revocable trust,” “the trust,” and “in a trust” demonstrates

that the elective share applies to property held “in a trust” and not property

owned or held by a legal entity similar to a trust. See Myers, 825 N.W.2d at 6.

The Panamanian PIF is not a trust. Section 633.238(1)(d)(1) uses the term

“trust” without further definition. Iowa’s Trust Code, chapter 633A, supplies the

governing definition. It defines a “trust” as “an express trust, charitable or

noncharitable, . . . wherever and however created.” Iowa Code § 633A.1102(21).

An express trust is one “created by the manifest intention of the settlor to create

them.” 76 Am. Jur. 2d Trusts § 17, at 49 (2016). As the “wherever and however”

language indicates, a settlor can express an intent to create a trust in a variety

of ways, but that language only broadens the methods by which a trust may be

formed; it does not give the courts the right to reclassify a nontrust entity as a

trust. See, e.g., In re NFO Members’ Custodial Acct., 255 N.W.2d 162, 163 9

(Iowa 1977) (en banc) (holding that a custodial account was a trust where “NFO

authorized establishment of a trust to be known as the NFO Grain Custodial

Account” and “the trust was reduced to a formal written declaration of trust”). In

this case, there is no evidence that James intended to create a trust governed by

the law of trusts. Instead, James chose a different legal regime to govern the

arrangement. He consulted with Panamanian counsel specifically to understand

how a PIF operates, and he took the steps required by Panamanian PIF law to

create and fund the entity. That deliberate selection of an alternative legal

framework is not a mere labeling choice to be disregarded but rather a

substantive decision about the legal regime that would govern the rights and

obligations of the parties with respect to the property at issue.

Nancy responds that James’s intent is immaterial because the transfer of

property into the PIF under these facts created a trust relationship, specifically

a revocable trust, regardless of what label is applied to the entity. At first glance,

Nancy’s argument is colorable, but upon further inspection it reveals the primary

defect in her theory of the case. The law of trusts creates a legal regime of rights,

duties, obligations, standards, and remedies with respect to property in which

legal and equitable title are held separately. The law of trusts governs the rights

and duties of parties when they specifically create a trust subject to the law of

trusts or when they enter into a transaction where the law imposes rights and

duties with respect to the property at issue, and no other law governs the

transaction. But where, as here, an independent body of law establishes a

nontrust entity; controls the creation, governance and operation of the nontrust

entity; and establishes the rights and duties of the parties with respect to the

nontrust entity and the property at issue, then the independent body of law

governs the legal arrangements rather than the law of trusts. 10

This is not simply a dispute about nomenclature. The Harris 6 Foundation

is governed by precisely the kind of independent legal regime that forecloses the

trust-law overlay. A PIF is a distinct legal entity governed by its own body of law

prescribing its creation, its governance structure, and its operation, including

the management and distribution of property owned by the PIF. Unlike a trust,

a PIF is a juridical person. Unlike revocable trusts, PIFs must be registered

publicly. See Panama Law No. 25 of June 12, 1995, art. 9. The filing of the

memorandum of foundation in the Public Registry shall give the foundation

juridical personality. See id. Property placed in a PIF cannot be used to satisfy

the personal liabilities of the founder or of the beneficiaries. See id. art. 11. Yet,

“trust property of a revocable trust is subject to the debts of the settlor to the

extent of the settlor’s power of revocation” during his lifetime, Iowa Code

§ 633A.3104(1), as well as to “[t]he charges of the settlor’s estate” and “[t]he debts

of the settlor,” with some exceptions, id. § 633A.3104(2).

Section 633.238(1)(d)(1)’s description of the revocable trust to which a spouse’s

elective share applies carries this same limitation—that the revocable trust first

be made available “for the payment of debts and charges” of the decedent. This

is yet another distinction between a PIF and a revocable trust. Finally, the

existence of legal provisions respecting testamentary matters in the domicile of

the founder or of the beneficiaries shall not be assessable against the foundation,

affect its validity or impede the fulfillment of its objectives set forth in its

memorandum of foundation or its regulations. See Panama Law No. 25 of

June 12, 1995, art. 14.

This last provision is particularly significant. The very law that creates and

defines the PIF expressly provides that the inheritance laws of the founder’s

domicile shall not be enforced against the foundation. A revocable trust under 11

Iowa law is, by express statutory design, subject to the surviving spouse’s elective

share. Iowa Code § 633.238(1)(d)(1). A PIF is, by the express terms of its enabling

legislation, immune from such claims. This structural incompatibility further

confirms that a PIF and a revocable trust are different legal creatures, not merely

different labels for the same legal relationship. Testimony from a leading expert

confirmed that a PIF is a wholly distinct estate-planning instrument designed to

operate outside traditional trust law. See also Mirabella Found. v. St. Claire

Livestock Invs., Inc., No. 09-22112-CIV, 2009 WL 5197842, at *4 (S.D. Fla.

Dec. 23, 2009) (“Panama Law 25, which governs the creation and governance of

foundations, has no analog in our jurisprudence.”); Carl Pacini & Nate

Wadlinger, How Shell Entities and Lack of Ownership Transparency Facilitate Tax

Evasion and Modern Policy Responses to These Problems, 102 Marq. L. Rev. 111,

127 (2018) (“The PIF is a vehicle . . . for tax management, estate planning

purposes, asset protection, and as an alternative to trusts.”).

Nancy relies on three cases to support her position that this separate legal

entity can nonetheless be classified and treated as a revocable trust within the

meaning of the elective share statute. The first is In re NFO Members’ Custodial

Account v. Beneficiaries of Aforesaid Trust, 255 N.W.2d at 163. That case involved

a “formal written declaration of trust” establishing “a trust to be known as the

NFO Grain Custodial Account.” Id. “The trust operated for some time, selling

members’ grain, receiving proceeds, making deductions as authorized, and

remitting net proceeds as directed by the trust declaration. Because of

unprecedented market conditions, the trust was unable to continue.” Id. The

trustees terminated the trust and resolved to liquidate the assets. Id. The

beneficiaries then objected to the jurisdiction of the probate court, contending

that the trust was not a trust subject to the court’s jurisdiction. Id. at 164. This 12

court rejected the argument, concluding that the facts showed the creation of an

express trust. Id. So, NFO held that an express trust, operated for a lengthy

period of time as a trust, was, in fact, an express trust. See id. at 164–65. The

holding of the case is of little value here.

Nancy invokes NFO primarily for its statement that a trust “exists when

legal and equitable title are separated with the person holding legal title obligated

to hold and administer the property for the benefit of the one holding equitable

title.” Id. She contends that this definition describes the Harris 6 Foundation.

But NFO’s definition serves to identify a trust relationship where one exists; it

does not impose a trust classification on every arrangement in which one party

holds property subject to obligations benefiting another. As explained above,

where a separate body of law already governs the arrangement and defines the

rights and duties of the parties, trust law has no role to play. We do not see how

NFO advances Nancy’s argument that an entity expressly not a trust and

governed by a different body of law should nonetheless be reclassified as a trust,

contrary to the law of the jurisdiction in which it was created.

The second case cited by Nancy is Drewes v. Schonteich, 31 F.3d 674 (8th

Cir. 1994). The issue in Drewes was whether a debtor’s right to receive monthly

payments under charitable gift annuity agreements constituted an interest in a

spendthrift trust that was excluded from her bankruptcy estate. Id. at 676. The

transaction at issue was a contract to provide annuity payments to a third-party.

Id. at 677. The contract itself did not create an entity and did not define the

nature of the relationship the contract created among the parties. See id. The

court thus looked to see whether the contractual relationship established all the

elements of a trust, and it concluded that it did. See id. Drewes teaches us that

where a transaction creates fiduciary relationships between persons with respect 13

to property that is not otherwise defined by some other body of law, the courts

will look to whether the elements of a trust are present and, if they are, will

classify the relationship accordingly. As with NFO, however, Drewes does not

address the question presented here: whether the courts will reclassify a

nontrust entity, a separate juridical person under the law creating the entity, as

a revocable trust.

In re Trust Created by Hormel, 163 N.W.2d 844 (Minn. 1968), is even

further afield. It was undisputed that a trust existed in that case. See id. at 846.

The question was whether a charitable corporation could serve as the trustee of

private trusts, and the Minnesota Supreme Court held that it could under the

circumstances presented. Id. at 852–53. The issue in this case is the scope of

Iowa Code section 633.238(1)(d)(1), not whether Harris 6 could have acted as a

trustee of an already existing trust.

The fact that the Arizona properties were subject to a mortgage does not

change the result in this case. On this record, it appears that Panamanian law

insulates PIF assets from the founder’s debts. The probate court acknowledged

that “Mr. Ibeling’s execution and administration of the Harris 6 Foundation was

not perfect.” This proceeding is not the proper place to collaterally litigate the

validity of the PIF or whether the transfer to the PIF was valid under Panamanian

law. If Nancy believes that the PIF was imperfectly created or that the transfer

was defective, that issue should be litigated in Panama. Whether James’s

transfer complied with Panamanian law governing creditor protection has no

bearing on whether the property owned by the PIF is part of the elective share

under our statute.

Finally, Nancy argues that our holding today will encourage

property-owning spouses to transfer assets to PIFs to evade the elective share 14

statute and therefore disadvantage surviving spouses. We note that these

public-policy arguments are misdirected. See Myers, 825 N.W.2d at 7–8. “[I]t is

not the role of [the] court to alter a statutory requirement in order to effect policy

considerations that are vested in the legislature.” In re Marriage of Thatcher,

864 N.W.2d 533, 546 (Iowa 2015) (second alteration in original) (quoting

Kakinami v. Kakinami, 260 P.3d 1126, 1133 (Haw. 2011)). In any event, her

argument is overstated. Panamanian Law No. 25 has been the law since 1995.

In the three decades since its enactment, this is the first time our court has been

presented with the issue of assets being held in a PIF. In fact, we found no

published case in the past thirty years addressing property held in a PIF.

III.

For the reasons explained above, we hold that Nancy’s elective share under

Iowa Code section 633.238(1)(d)(1) does not include one third of the value of the

property owned by the Harris 6 Foundation.

Decision of Court of Appeals and District Court Judgment Affirmed.

Oxley, McDermott, and May, JJ., join this opinion. Mansfield, J., files a

dissenting opinion, in which Christensen, C.J., and Waterman, J., join. 15

#24–1139, In re Estate of Ibeling

Mansfield, Justice (dissenting).

The property by what it is should go, Not by the title.

William Shakespeare, All’s Well That Ends Well act 2, sc. 3, ll. 141–42.

“If it looks like a duck, swims like a duck, and quacks like a duck, then it

probably is a duck.” Anonymous.

Whether we apply Shakespeare’s eloquence or today’s common sense, the

result should be the same. The Harris 6 Foundation (Foundation) meets the

criteria of Iowa Code section 633.238(1) (2021) and its assets should have been

included in Nancy Ibeling’s elective share.

Iowa Code section 633.238(1)(d)(1) provides,

1. The elective share of the surviving spouse shall be limited to all of the following:

d. (1) One-third in value of the property held in trust not necessary for the payment of debts and charges over which the decedent was a settlor and retained at the time of death the power to alter, amend, or revoke the trust . . . .

The Foundation held property that James Ibeling had transferred to it in

trust and over which he retained the power to alter, amend, or revoke the trust.

The fact that it wasn’t called a trust under Panamanian law should make no

difference in the case. But it makes all the difference to the majority.

Let’s review the facts of this case, something the majority opinion fails to

do in full. James formed the Foundation in 2013, but at that time it was just an

empty shell.1 In 2019, James was “considering getting married (without a

1The documents recite that the initial funding of the Foundation was $10,000, but James’s Panamanian lawyer, Carlos Varela Cardenal, testified that this was a “nominee amount,” and no money was actually there. 16

prenup) and want[ed] to protect his assets.” So he transferred a number of

Arizona properties into the Foundation.

James was the only beneficiary of the Foundation during his lifetime. On

his death, four beneficiaries would receive its assets. Nancy wasn’t one of those

beneficiaries.

James also was the “protector” of the Foundation. As protector, he had

control over the Foundation. Three Panamanian individuals with the same

address as James’s Panamanian attorney served as the “council” for the

Foundation, but they took orders from James and could be removed and

replaced by him. As Juan Pablo Fábrega Polleri explained, a protector “has

control over the actions of the members of the foundation council.”

In short, James set up the Foundation, delivered his personal assets to it,

and retained the ability during his lifetime to remove any of those assets and

close down the Foundation.

The Foundation obviously wasn’t called a revocable trust, but if it had been

formed in Iowa, it would have been. Fábrega Polleri explained that so-called

“trusts” under Panamanian law cannot have the same settlor, trustee, and

beneficiary: “Panama law-wise . . . that could not happen.” Fábrega Polleri added

that the Panamanian private interest foundation gives the founder control over

the assets he wouldn’t otherwise have with a Panamanian trust, and so

foreigners prefer to use the private interest foundation.

The majority argues that the Foundation does not fall within

section 633.238(1)(d)(1) because James resorted to “an independent body of law”

to create “a distinct legal entity.” This argument begs the question of what the

distinct legal entity looked like. Here, the distinct legal entity that James created

had all the attributes of a revocable trust. It was “property held in trust . . . over 17

which the decedent was a settlor and retained at the time of death the power to

alter, amend, or revoke the trust.” Iowa Code § 633.238(1)(d)(1).

It doesn’t matter whether James went to Panama City or Polk City to create

the Foundation. It had all the features of an Iowa revocable trust. In the end,

despite the majority’s repeated protestations, this case is “simply a dispute about

nomenclature.”

The majority makes only one substantive effort to distinguish the

Foundation from an Iowa revocable trust. It notes that Panamanian law does not

allow the assets of a private interest foundation to be used to satisfy the demands

of the founder-beneficiary’s creditors. But section 633.238(1)(d)(1) doesn’t

require that. Again, the property merely has to be “held in trust . . . over which

the decedent was a settlor and retained at the time of death the power to alter,

amend, or revoke the trust.” Id. Suppose Missouri passed a law that revocable

trusts could not be used to satisfy the demands of the founder-beneficiary’s

creditors. Would that mean that an Iowan who died after transferring their Iowa

assets to a Missouri revocable trust could avoid all creditors? I think not. At a

minimum, a choice-of-law question would arise. See Hussemann ex rel. Ritter v.

Hussemann, 847 N.W.2d 219, 222 (Iowa 2014) (applying choice-of-law principles

to an elective-share question).

In that regard, Fábrega Polleri himself acknowledges,

Since [the] Panamanian statute is of a domestic and territorial nature and application, the foreign judge dealing with the process could disregard the Law and seize the assets of the Foundation which are located under his/her constituency in the event a family or hereditary controversy or claim arises within a jurisdiction where the Founder or Beneficiaries have their domicile or where an asset of the Foundation’s Patrimony is located.

In addition, the Foundation has all the essential features of a trust as

delineated in In re NFO Members’ Custodial Account, 255 N.W.2d 162, 164–65 18

(Iowa 1977) (en banc); see also Reeder v. Reeder, 168 N.W. 122, 124 (Iowa 1918)

(stating that “[n]o technical language is necessary” to create a trust). NFO may

be distinguishable factually, but its legal analysis is spot on.

Finally, I agree with the majority about one thing. I am skeptical of Nancy’s

claim that this case will lead to a flood of Iowans hiring Panamanian attorneys

to set up Panamanian private interest foundations. Iowa will survive the effects

of today’s decision. Nevertheless, we should not be indulging a “lawyer’s game.”

Massachusetts v. EPA, 549 U.S. 497, 548 (2007) (Roberts, C.J., dissenting). I

dissent and would reverse the decision of the court of appeals and the judgment

of the probate court.

Christensen, C.J., and Waterman, J., join this dissent.