Court Reverses Jury Verdict And Holds That Trustor Could Not Revoke Trust

by Winstead PC
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In Coyle v. Jones, two sisters fought over the whether $197,000 belonged to their mother’s estate or to a trust. No. 05-16-00876-CV, 2017 Tex. App. LEXIS 11173 (Tex. App.—Dallas November 30, 2017, no pet. history). A trustor and her husband formed a revocable trust that stated: “At any time during the joint lives of the Trustors, . . . the Trustors may . . . revoke this Trust Agreement in part or in whole.” Id. It further provided that “except as otherwise provided,” on the death of either trustor, the designation of the beneficiaries of specific gifts in the Agreement would become irrevocable, and not subject to amendment or revocation. Id. The trustor’s husband died in 2001. In 2010, the trustor executed a document purporting to revoke the trust and transfer all trust assets to herself. The trustor died in April 2011. One daughter was the trustee of the trust, and the other daughter was the executor of the trustor’s estate. They sued each other over who rightfully owned the property, which was cash. A jury determined that the trustor had revoked the trust, and the trial court entered judgment that the cash belonged to the estate.

The court of appeals reversed, holding that the evidence proved as a matter of law that the trust had not been revoked and that it should own the cash. The court stated:

In the case before us, the jury was instructed that a settlor may revoke a trust “unless it is irrevocable by the express terms of the trust agreement creating it or of an instrument modifying it.” The express language of the Agreement creating the trust at issue provided that the trust agreement could be revoked “at any time during the joint lives of the Trustors.” The Agreement further provided that other than that, when either trustor died, “the designation of Beneficiaries of specific gifts in this Trust shall become irrevocable, and not subject to amendment or modification.” The only evidence of revocation before the jury, however, was Frances’s 2010 written revocation. It is undisputed that Frances executed the revocation almost nine years after Stuart’s death. Absent any evidence to support the jury finding that the Agreement was revoked  while both trustors were alive, there is legally insufficient evidence to support the jury’s revocation finding. To the contrary, the evidence at trial conclusively established that Frances could not revoke the Agreement after Stuart’s death. Because there is no evidence to support jury’s revocation finding, we resolve Coyle’s third issue in her favor. Our resolution of this issue makes it unnecessary to address Coyle’s issues complaining of charge error or the legal sufficiency of the jury’s damage award.

Id.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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