IN THE MATTER OF THE W.N. CONNELL AND MARJORIE T. CONNELL LIVING TRUST, DATED MAY 18; 1972.
JACQUELINE M. MONTOYA; AND KATHRYN A. BOUVIER, Respondents. ELEANOR C. AHERN, A/K/A ELEANOF CONNELL HARTMAN AHERN, Appellant, IN THE MATTER OF THE W.N. CONNELL AND MARJORIE T. CONNELL LIVING TRUST, DATED MAY 18, 1972, AN INTER VIVOS IRREVOCABLE TRUST. ELEANOR CONNELL HARTMAN AHERN, Appellant,
KATHRYN A. BOUVIER; AND JACQUELINE M. MONTOYA, Respondents. IN THE MATTER OF THE W.N. CONNELL AND MARJORIE T. CONNELL LIVING TRUST, DATED MAY 18, 1972, AN INTER VIVOS IRREVOCABLE TRUST. ELEANOR CONNELL HARTMAN AHERN, Appellant,
JACQUELINE M. MONTOYA; AND KATHRYN A. BOUVIER, Respondents.
appeals from orders issuing a preliminary injunction,
appointing a temporary trustee, granting summary judgment, ;
and awarding attorney fees in a trust action. Eighth Judicial
District Court, Clark County; Gloria Sturman, Judge.
Brownstein Hyatt Farber Schreck, LLP, and Kirk B. Lenhard,
Tamara Beatty Peterson, and Benjamin K. Reitz, Las Vegas, for
Albright Stoddard Warnick & Albright and Whitney B.
Warnick, Las Vegas; The Rushforth Firm, Ltd., and Joseph J.
Powell, Las Vegas, for Respondents.
DOUGLAS, GIBBONS and PICKERING, JJ.
and Marjorie T. Connell established the W.N. Connell and
Marjorie T. Connell Living Trust, dated May 18, 1972.
Appellant Eleanor C. Ahern is the only surviving child of
W.N. Connell and the adopted daughter of Marjorie. Eleanor
has two daughters, respondents Jacqueline M. Montoya and
Kathryn A. Bouvier. The 1972 Trust was funded in part with
oil, gas, and mineral rights and leases (the oil assets) that
were W.N. Connell's separate property and which generated
royalties. During the trustors' joint lifetimes, they
served as trustees and subtrust No. 1 governed principal and
Connell died in November 1979. Upon the first trustor's
death, the 1972 Trust provided that the assets therein were
to be divided into two subtrusts, Trust No. 2, of which
Eleanor was the beneficiary, and Trust No. 3, of which
Marjorie was the beneficiary. Marjorie remained trustee. In
May 1980, Marjorie filed a substitution of trustee, adding
Eleanor "as [c]o-[t]rustee of the separate property [the
oil assets] of W. N. Connell presently held in the 
Trust." Between 1980 and Marjorie's death in 2009,
Marjorie received 65% of the oil royalties and Eleanor
received 35%. During this time, K-l tax forms were prepared
for Marjorie for Trust No. 3, and Eleanor for Trust No. 2,
reflecting this distribution. The oil assets remained titled
in the 1972 Trust and were not split into Trust No. 2 or
Trust No. 3. While division orders from the oil companies
listed Marjorie and Eleanor as cotrustees of the 1972 Trust,
starting in 1986, Marjorie provided the oil companies with an
IRS employee identification number (EIN) for Trust No. 2. An
affidavit from Marjorie's tax preparer for the 1972 Trust
stated that Marjorie provided Trust No. 2's EIN to the
oil companies because it was associated with the bank account
that Marjorie used to collect and distribute the royalties
and so that the oil companies would have an EIN for
recordkeeping purposes, not to reflect any change in
executed a pour-over will that exercised the power of
appointment in Trust No. 3, which on her death transferred
the assets in Trust No. 3 to the MTC Living Trust, whose
beneficiaries were respondents. After Marjorie's death,
title to the oil assets remained with the 1972 Trust, but the
parties continued to split the royalties, 65% to respondents
and 35% to Eleanor. In 2013, Eleanor ceased distributions of
the royalties to respondents, claiming that Trust No. 2 owned
100% of the oil assets and that the previous 65% distribution
of royalties had been gifts from Eleanor.
initiated the underlying litigation, petitioning the court in
2013 and 2014 for declarations that the MTC Trust owned 65%
of the oil assets, for attorney fees based on Eleanor's
alleged breach of fiduciary duties, and for a preliminary
injunction directing Eleanor to distribute 65% of the
royalties to the MTC Trust. The parties subsequently filed
cross-motions for summary judgment.
district court ordered the appointment of a new temporary
trustee pending the resolution of this litigation and granted
a preliminary injunction conditioned on respondents posting a
bond. The district court later granted summary judgment in
respondents' favor, construing the 1972 Trust as
requiring a split of the oil assets with Trust No. 2
receiving a 35% interest and Trust No. 3 receiving a 65%
interest, and that regardless, laches barred Eleanor from
asserting that Trust No. 2 owned 100% of the oil assets. The
district court also granted summary judgment on
respondents' breach-of-fiduciary-duty claim and awarded
them attorney fees under NRS 153.031. Eleanor appeals.
judgment regarding the trust interpretation
the 1972 Trust, Trust No. 1 held all of the oil assets during
the trustors' joint lifetimes. Upon the first
trustor's death, the trustee was required to allocate to
Trust No. 3 the fractional share of W.N. Connell's
separate property (i.e., the oil assets) "equal to the
maximum marital deduction allowed" by federal tax law,
less any other amounts that qualified as a marital deduction
but that were not a part of the 1972 Trust. The remaining
fractional portion of the oil assets was to be allocated to
Trust No. 2. In light of the evidence, the district court
correctly determined that under the 1972 Trust, Trust No. 2,
and thus Eleanor, received a 35% interest in the oil assets
and the remaining 65% was apportioned to Trust No. 3, and
thus to respondents as beneficiaries under the MTC Trust.
Wood v. Safeway, Inc., 121 Nev. 724, 729, 121 P.3d
1026, 1029 (2005) (reviewing de novo a district court's
summary judgment and recognizing that summary judgment is
proper where there are no genuine issues of material fact);
see In re Cable Family Trust, 231 P.3d 108, 111
(N.M. 2010) (reviewing trust interpretation de novo).
Eleanor contends that the fourth article, which provides that
"[a] 11 income received by this Trust from the separate
property of the Decedent shall be paid to [Eleanor], "
governs the entire trust, that article governs Trust No. 2,
only. Applying the fourth article to the entire 1972 Trust
instead of just Trust No. 2 would create an inconsistency by
requiring income from other portions of the 1972 Trust, of
which Eleanor is not a beneficiary, to be paid to Eleanor as
the beneficiary of Trust No. 2. Thus, interpreting the 1972
Trust as a whole requires rejecting Eleanor's
construction. Rd. & Highway Builders, LLC v. N. Nev.
Rebar, Inc., 128 Nev. 384, 390, 284 P.3d 377, 380-81
(2012) (explaining that the intentions of contracting parties
are ascertained by considering documents as a whole).
interpretation would also render the third article
superfluous. See Musser v. Bank of Am., 114 Nev.
945, 949, 964 P.2d 51, 54 (1998). The third article provides
that a fractional share of the oil assets "equal to the
maximum marital deduction" shall be allocated to Trust
No. 3, and when making that allocation, the determination of
the amount allocated "shall be as finally established
for federal estate tax purposes." Although a copy of the
federal estate tax return filed on W.N. Connell's behalf
could not be located, respondents provided an IRS closing
letter, which reflected a net federal estate tax for W.N.
Gonnell of $18, 081, and a Texas estate tax return for W.N.
Gonnell, which was facially based on the federal estate tax
form and which indicated 64.493% of the oil assets had been
distributed to Marjorie, via Trust No. 3, and 35.507% had
been distributed to Eleanor, via ...