Article on Settlor’s Ignorance Constituting Mistake of Law

Zachary R. Eiken recently published a case comment entitled, Trust Law: Settlor Ignorance of Applicable Laws May Constitute A Mistake of Law Under North Dakota Century Code Section 59-12-15 (In re Mattew Larson Agreement, 831 N.W.2d 388), 89 N.D. L. Rev. 503-520 (2013).  Provided below is the article’s abstract:

In In re Matthew Larson Trust Agreement, the North Dakota Supreme Court held that the mistaken legal effects caused by a settlor’s ignorance of applicable laws may warrant trust reformation under North Dakota Century Code section 59-12-15 if the moving party proves beyond clear and convincing evidence that such effects negate the settlor’s intentions in creating the trust. With this conclusion, the court unequivocally rejected the application of contracting principles within the context of trust reformation claims. As a matter of first impression in North Dakota, Matthew Larson resolves a number of questions under North Dakota trust reformation law, but the decision unfortunately leaves some issues unresolved, the most important of which is Matthew Larson’s applicability to commercial trust reformation claims. Because contracting principles will control commercial trust reformation claims, the North Dakota Supreme Court will have to qualify Matthew Larson so to apply solely to noncommercial trust reformations. In doing so, North Dakota will have to adopt a bifurcated trust reformation scheme that recognizes two distinct categories of trust reformation claims that are premised upon the exchange of consideration or the lack thereof.