Utah Court of Appeals Applies the Discovery Rule in Trust Case

Analisa Bowen sued to invalidate a 2001 amendment to the Bruce J. Bowen Irrevocable Trust that removed Analisa and her brother as beneficiaries. The trial court invalidated the trust amendment and held that Bowen’s claims were not brought outside the limitation period after the court applied the discovery rule. The court also found that the settlor intended to disinherit Bowen and her brother, but the court refused to reform the trust to conform with the settlor’s intent. Without the discovery rule, Bowen’s claims would be barred by the four year statute of limitations.  

In Bowen v. Bowen, 2011 Utah App. LEXIS 347 (2011), the Utah Court of Appeals found that exceptional circumstances existed to justify the application of the discovery rule because (i) Bowen had no reason to suspect she was a beneficiary or that she was removed by amendment because she received no notice of the amendment, (ii) there was little prejudice to the defendant in allowing the claim, and (iii) the equities weighed in favor of a finding of exceptional circumstances. The court upheld the trial court’s invalidation of the amendment because the settlor failed to follow the manner and circumstances outlined in the trust document for making a valid amendment. The court also upheld the trial court’s refusal to modify the trust even though the settlor intended to disinherit Bowen and her brother. 

See Dana G. Fitzsimons and Jr. and Meghan L. Gehr, Recent Cases of Interest to Fiduciaries, McGuire Woods (2011).

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.