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Title
When adjudicating trust disputes, the equity courts are duty-bound to act, sua sponte if
necessary, in vindication of the lawful intentions of settlors
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In a trust dispute, the court, apart from functioning judicially, is “administratively” tasked
with defending settlor intent, an affirmative duty that is derived not from the pleadings but from
general principles of equity. A trust dispute in litigation is not an action at law. It is an action in
equity. That being the case, the court has an affirmative duty, acting sua sponte when necessary,
“to see to it that the trust is faithfully executed,” the institution of the trust itself being a creature
of equity. See Rock Springs Land and Timber, Inc. v. Lore, 75 P.3d 614 (2003). That a particular
equitable remedy has not been requested in any of the pleadings, for example, is no excuse for
the court’s failing to mete it out sua sponte, provided to do so will further the trust’s “faithful
execution.” Id. The court is duty-bound to do so. Counsel incompetency is no excuse for not
doing so. In many cases the settlor will have been long dead and thus be in no position to
advocate for the lawful purposes manifested in the trust’s terms.
One commentator has explained the “administrative” function of the equity court in the
trust context this way: “There is, however, a tendency in the United States for a court that has
supervision over the administration of a trust to enforce the trustee’s duties even though the
beneficiaries have not asked it to do so.” He goes on, “The notion, although rarely articulated,
seems to be that it is the function of the court to see that the settlor’s directions are carried out,
even though no one complains to the court; that the court has administrative powers, not just
judicial powers; and that once the court acquires jurisdiction over the administration of a trust, it
is the court’s function to see that the trust is administered in accordance with the settlor’s
directions.” Scott and Ascher on Trusts §24.4.4.
Now for a case in which the judiciary treated a trust dispute as if it were a mere action at
law. Ex-wife deeds a parcel of real estate to ex-husband with the present intention that ex-husband
take the legal title, as trustee, not outright. No mention, however, is made of that intention in any
property-transfer documentation. Is the trust enforceable or does the property belong to the
transferee outright and free of trust? On similar facts, one Washington appellate court, looking
only to the state’s statutory trust law, answered outright and free of trust in that the ex-wife had
not formally memorialized her entrustment intentions at the time of transfer, nor had the ex-
husband formally declared himself an express trustee of the property. See K & W Children’s Trust
v. Estate of Fay, 503 P.3d 569 (Washington 2022), discussed in another context in one of my prior
JDSUPRA postings. There, however, had been a transfer of legal title. There was/is credible
extrinsic evidence that ex-wife had had a present intention to have a trust impressed on the real
estate at the time of transfer. By taking title to the real estate as if it were free of trust in
contravention of what the ex-wife had intended, the ex-husband had been unjustly enriched. The
regimes of constructive trust and resulting trust, each a creature of equity, not statute, have
traditionally been exempt from the statute of frauds’ application to land entrustments, specifically
its requirement that there be a memorializing writing. Ergo: With or without ex-husband’s consent,
