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Cite as 303 Neb. 430

In re Trust Created by Jack Fenske, also known as

Jack B. Fenske and John B. Fenske, deceased.

Jennifer Lea Wheeler and Laura Jean Grace, now

known as Laura Jean Wilson, appellants, v. 

Elkhorn Valley Bank & Trust, Trustee

of the Jack Fenske, also known as

Jack B. Fenske and John B. Fenske, 

Revocable Trust, appellee.

___ N.W.2d ___

Filed June 28, 2019. No. S-18-262.

1. Decedents’ Estates: Trusts: Equity: Appeal and Error. The removal 

of a trustee is a question of equity, and therefore an appellate court 

reviews the issue de novo on the record.

2. Appeal and Error. In a review de novo on the record, an appellate court 

reappraises the evidence as presented by the record and reaches its own 

independent conclusions concerning the matters at issue.

3. Statutes. Statutory interpretation presents a question of law.

4. Judgments: Appeal and Error. An appellate court independently 

review questions of law decided by a lower court.

Appeal from the County Court for Madison County: Donna

F. Taylor, Judge. Affirmed.

David P. Wilson and Jonathan M. Brown, of Walentine 

O’Toole, L.L.P., for appellants.

Mark D. Fitzgerald, of Fitzgerald, Vetter, Temple & Bartell, 

for appellee.

Heavican, C.J., Miller-Lerman, Cassel, Stacy, Funke, 

Papik, and Freudenberg, JJ.

Nebraska Supreme Court Online Library

www.nebraska.gov/apps-courts-epub/

07/05/2019 09:05 AM CDT
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Papik, J.

Nebraska has adopted a section of the Uniform Trust Code 

which allows a court to remove a trustee if removal is 

requested by all beneficiaries, removal best serves the interests of all beneficiaries and is not inconsistent with a material purpose of the trust, and a suitable replacement trustee is 

available to serve. That provision is at issue in this appeal in 

which trust beneficiaries challenge a county court order denying their petition to remove the trustee. We conclude that the 

beneficiaries failed to prove that removal of the trustee was 

not inconsistent with a material purpose of the trust, and therefore we affirm.

BACKGROUND

Jack Fenske Trust.

Jack Fenske, also known as Jack B. Fenske and John B. 

Fenske, died on December 25, 1998. His last will and testament, executed about a year before his death, devised most of 

his property to Elkhorn Valley Bank & Trust (the Bank), as 

trustee, for the benefit of specific family members. Those family members included the appellants in this case, Jennifer Lea 

Wheeler (Jennifer) and Laura Jean Grace, now known as Laura 

Jean Wilson (Laura). The trust provided as follows:

b. Ninety-five percent (95%) [of the principal balance] for my niece . . . to hold and manage the same 

until the death of my said niece, with directions to said 

Trustee to distribute the annual income from the corpus 

of said trust to [my niece] annually, with the restriction 

that there be no invasion of the corpus of this trust by 

my said Trustee except for distribution for educational 

expenses for my greatnieces [sic], Jennifer . . . and Laura 

. . . . I further direct that upon the death of my niece . . . 

the annual income from the corpus of the trust shall be 

distributed in equal shares annually to my greatnieces 

[sic], Jennifer . . . and Laura . . . , in equal shares. The 

Trustee is specifically authorized to invade the corpus at 
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any time for distribution to Jennifer . . . and Laura . . . 

for educational expenses.

c. At the death of Jennifer . . . and Laura . . . , the 

Trustee shall distribute all remaining corpus and accumulated income, if any, to the heirs of Jennifer . . . and Laura 

. . . in equal shares.

Fenske’s niece died prior to Fenske, and consequently, 

Jennifer and Laura began receiving income distributions from 

the trust upon Fenske’s death. Trust assets were also available 

to them for educational purposes. At all times relevant to these 

proceedings, Jennifer had two adult children and Laura had 

one adult child.

The parties do not dispute that as of September 2017, the 

trust property consisted of approximately $52,000 in money 

market funds, agricultural land assessed at approximately 

$278,500, and a nearly $30,000 debt owed by Jennifer.

Request for Trustee’s Resignation.

It is undisputed that Jennifer, Laura, and their children 

all support removing the Bank as trustee and replacing it 

with David P. Wilson, Laura’s husband who is an attorney. 

According to the record, in 2016, Wilson relayed a request that 

the Bank voluntarily resign as trustee, citing concerns about 

trust income and an intent to initiate termination of the trust.

The Bank refused to resign. It stated in a letter that the 

request for the Bank’s resignation and the plan to terminate 

the trust were not consistent with the material terms of the 

trust, noting that a member of the Bank’s trust committee knew 

Fenske personally and had some insight into why he set up the 

trust as he had. The Bank offered to discuss concerns about the 

trust income and the pros and cons of liquidating the trust real 

estate, but received no response.

“Petition to Modify.”

On September 22, 2017, Jennifer and Laura filed a “Petition 

to Modify” the trust to remove the Bank as trustee and approve 

Wilson as successor trustee. They invoked Neb. Rev. Stat. 
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§ 30-3862(b)(4) (Reissue 2016), a provision of the Uniform 

Trust Code.

According to the petition, there had been a substantial 

change in circumstances and the removal of the Bank as trustee 

was requested by all the qualified beneficiaries. Jennifer and 

Laura further alleged that the removal of the Bank served the 

interests of all the beneficiaries, that it was not inconsistent 

with a material purpose of the trust, and that a suitable successor trustee was available. In addition, Jennifer and Laura 

asserted that they had completed their educational goals, that 

trust administration fees had exceeded trust income in recent 

years, and that Wilson was available to serve as successor 

trustee free of charge.

The Bank filed a general objection to the petition to modify.

Hearing on Petition to Modify.

At the hearing on the petition to modify, Laura testified 

about the operation of the trust as to herself and Jennifer. Laura 

stated that she used trust funds to obtain a master of business 

administration and a law degree and that she would not require 

additional funds from the trust for educational purposes. Laura 

testified that Jennifer also obtained money from the trust to 

fund educational pursuits. To the best of Laura’s knowledge, 

Jennifer would not require additional funds from the trust for 

educational purposes.

As to Fenske’s intentions, Laura characterized Fenske as a 

frugal man who was generous to his family, including Jennifer 

and Laura. According to Laura, Fenske never married and 

viewed her and Jennifer as grandchildren. Based on her knowledge of him, Laura believed that Fenske established the trust to 

share his assets with his family. In her opinion, removing the 

Bank as trustee would not frustrate that purpose.

Laura admitted that the Bank had not committed any wrongdoing in administering the trust. Instead, Laura expressed concern about the fees the Bank was charging for its services as 

trustee. Laura preferred that Wilson serve as trustee, because 
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she believed he had the necessary knowledge and experience 

to serve as a competent trustee and he had agreed to serve 

without charging fees.

Laura acknowledged, however, that reducing the fees 

charged to the trust was not the only reason motivating the 

effort to have the Bank removed. She testified that removing 

the Bank as trustee was part of a plan, which she hoped would 

culminate in the termination of the trust, the liquidation of the 

trust assets, and the distribution of the proceeds to the qualified 

beneficiaries in a manner yet to be determined.

Richard Stafford, the attorney who did Fenske’s estate 

planning as well as other legal work, also testified. Stafford, 

who had known Fenske since the 1970’s, described him 

as an “old-school farmer,” for whom acquiring and holding 

land was “paramount.” According to Stafford, Fenske did not 

accept the notion that he was not going to own and control his 

land forever.

Fenske had resisted estate planning for years until he surprised Stafford by discussing a will. Stafford stated that it was 

possible that Fenske’s will and trust document was drafted in 

one sitting and signed on the same day. Stafford explained that 

this was likely the reason Fenske’s explicit wishes were not 

included in the document, as they typically would be.

However, Stafford testified that in preparing the will and 

trust, Fenske expressed the desire to delay vesting in his beneficiaries, because he did not believe his brothers or anyone he 

knew were capable of handling his estate or his assets according to his wishes and he did not want them “squandered.” 

Stafford also testified that Fenske wanted a trustee “to keep it 

together as long as it could possibly be kept together” and “to 

hold on to the land for as long as possible,” because Fenske 

viewed owning agricultural property as a “sign of success.”

Stafford testified that Fenske wanted the trustee to be “independent.” Moreover, he had a history with the Bank, which 

operated the only full-time trust department in the area. Fenske 

also knew the Bank’s president, who still held that position 
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at the time of trial. When asked if there was a reason why 

a trustee other than the Bank could not carry out the material purposes of the trust, Stafford replied, “No, other than 

. . . the one thing that I think [Fenske] was really trying to get 

away from was to have any of his relatives being in charge of 

his assets.”

Regarding Fenske’s specific intentions toward the beneficiaries, Stafford stated, “[Fenske] wanted to take care of [his 

niece] and wanted to keep his assets together for yet another 

generation while providing educational benefits and the annual 

income to the interim generation.” In Stafford’s opinion, 

Fenske appreciated the value of education, but he appreciated 

the value of farmwork more.

A trust officer for the Bank described the assets of the trust 

and the issues confronting the trustee and the beneficiaries. At 

the time of trial, the trust property included some liquid assets, 

but the bulk of it was composed of agricultural land that was 

rented as pasture at fair market value for northeast Nebraska, 

producing income that did not reflect the value of the land. The 

trust officer testified that the proximity of the land to Norfolk, 

Nebraska, gave the land potential for development, but sale 

of the land would result in significant capital gains taxes that 

would deplete the principal trust assets. Nonetheless, in its 

response to the requested resignation, the Bank had expressed 

a willingness to discuss concerns with the trust income and 

liquidating the trust real estate.

The county court also received a summary of distributions 

and fees prepared by the Bank. This indicated that in the previous 6 years, the trustee fees slightly exceeded the distributions 

of income, but that nearly $240,000 in principal had also been 

distributed. The Bank’s trust officer attributed the principal distributions to Jennifer’s and Laura’s educational pursuits.

County Court’s Order.

After receiving briefs from the parties, the county court 

issued a written order denying the petition to remove the Bank 
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as trustee. It found that no substantial change in circumstances 

had occurred. The county court did conclude that all the 

qualified beneficiaries had requested removal as required by 

§ 30-3862(b)(4). However, the county court determined that it 

did not have enough information to determine whether removal 

would best serve the interests of all qualified beneficiaries.

Furthermore, the county court found that removal would 

be inconsistent with a material purpose of the trust. On that 

question, the county court emphasized that Fenske appointed 

the Bank as trustee and characterized as speculation Jennifer 

and Laura’s position that he appointed the Bank only because 

he had no family members capable of serving as trustee. The 

county court also expressed concern with Laura’s admission 

that one of the purposes for removing the trustee was to seek 

to have the trust terminated, a result the county court described 

as inconsistent with the terms of the trust.

Finally, the county court concluded that Wilson was not 

a suitable successor trustee for purposes of § 30-3862(b)(4). 

While the court acknowledged Wilson’s general qualifications 

to administer a trust, it found he was not suitable to serve as 

trustee in this case, because he had not been nominated by 

Fenske and his stated intention to terminate the trust was contrary to its provisions.

Jennifer and Laura now appeal.

ASSIGNMENTS OF ERROR

Jennifer and Laura assign, condensed and restated, that the 

county court erred in (1) finding that they had not satisfied 

all the requirements of § 30-3862(b)(4) and (2) applying a 

“clearly stated provision” standard rather than a “material purpose” standard.

STANDARD OF REVIEW

[1,2] Where a question of equity is presented in a trust 

administration matter, appellate review of that issue is de novo 

on the record. See In re Henry B. Wilson, Jr., Revocable Trust, 
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300 Neb. 455, 915 N.W.2d 50 (2018). The removal of a trustee 

is a question of equity, and therefore an appellate court reviews 

the issue de novo on the record. Id. In a review de novo on 

the record, an appellate court reappraises the evidence as presented by the record and reaches its own independent conclusions concerning the matters at issue. In re Margaret Mastny 

Revocable Trust, 281 Neb. 188, 794 N.W.2d 700 (2011).

[3,4] Statutory interpretation presents a question of law. In 

re Trust of Shire, 299 Neb. 25, 907 N.W.2d 263 (2018). We 

independently review questions of law decided by a lower 

court. Id.

ANALYSIS

Statutory Authority Governing 

Trustee Removal.

We begin by setting forth the relevant statutory authority. 

Section 30-3862, which became operative in 2005, is identical to § 706 of the Uniform Trust Code. It provides authority 

for courts to remove trustees under various circumstances. 

Relevant to this appeal, it provides:

(a) The settlor, a cotrustee, or a beneficiary may request 

the court to remove a trustee, or a trustee may be removed 

by the court on its own initiative.

(b) The court may remove a trustee if:

. . . .

(4) there has been a substantial change of circumstances or removal is requested by all of the qualified 

beneficiaries, the court finds that removal of the trustee 

best serves the interests of all of the beneficiaries and is 

not inconsistent with a material purpose of the trust, and a 

suitable cotrustee or successor trustee is available.

This appears to be this court’s first opportunity to interpret 

and apply this language. Some courts have referred to the 

grounds for removal set forth above as a “no-fault” removal 

provision, because it allows for removal with no showing 

of wrongdoing on the part of the trustee. See, e.g., In re 
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McKinney, 67 A.3d 824 (Pa. Super. 2013); Litoff v. Albright, 

No. NNHCV136037921S, 2014 WL 3584834 (Conn. Super. 

June 17, 2014) (unpublished opinion). Instead, a court may 

remove a trustee if the party seeking removal shows that (1) 

removal is requested by all the beneficiaries, (2) removal of 

the trustee best serves the interests of all the beneficiaries, (3) 

removal is not inconsistent with a material purpose of the trust, 

and (4) a suitable replacement trustee is available.

Jennifer and Laura contend that they demonstrated each of 

the above elements in this case. No one disputes that removal 

was requested by all the beneficiaries. But we have occasion 

to address only one of the other elements that are in dispute—

whether removal of the Bank would be inconsistent with a 

material purpose of the trust. Our analysis of that issue follows 

in the sections below.

When Is Removal of Trustee 

Inconsistent With Material 

Purpose of Trust?

Before turning to whether removal of the Bank would be 

inconsistent with a material purpose of the trust in this case, 

we pause to consider what that question entails. Crucial to our 

analysis is, of course, what it means under § 30-3862(b)(4) for 

a proposed trustee removal to be “inconsistent with a material purpose of the trust.” Nebraska’s Uniform Trust Code 

does not define “material purpose.” However, the comments 

to the Uniform Trust Code provide some guidance, and the 

Legislature directly referred to sections of the code when 

adopting it, thereby incorporating those comments. See In re 

Trust of Shire, 299 Neb. 25, 907 N.W.2d 263 (2018).

The most guidance regarding the meaning of “material purpose” can be found in the comment to § 411 of the Uniform 

Trust Code, a provision that makes the material purposes of 

a trust relevant to whether termination or modification of a 

trust is permitted. See Neb. Rev. Stat. § 30-3837 (Reissue 

2016). We find the comment to § 411 useful, because the 
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comment to § 706 of the Uniform Trust Code explains that 

it is “a specific but more limited application of” § 411. Unif. 

Trust Code § 706, 7D U.L.A. 254 (2018). The comment to 

§ 411 states:

In order to be material, the purpose . . . must be of some 

significance: “Material purposes are not readily to be 

inferred. A finding of such a purpose generally requires 

some showing of a particular concern or objective on 

the part of the settlor, such as concern with regard to 

a beneficiary’s management skills, judgment, or level 

of maturity.”

Unif. Trust Code § 411, 7D U.L.A. 160 (2018), quoting 

Restatement (Third) of Trusts § 65, comment d. (2003).

The Restatement commentary quoted in the comment on 

the Uniform Trust Code elaborates further on the meaning of 

material purpose in this context. It provides:

Thus, a court may look for some circumstantial or other 

evidence indicating that the trust arrangement represented to the settlor more than a method of allocating 

the benefits of property among multiple intended beneficiaries, or a means of offering to the beneficiaries 

(but not imposing on them) a particular advantage. 

Sometimes, of course, the very nature or design of a 

trust suggests its protective nature or some other material purpose.

Restatement, supra, § 65, comment d. at 477.

[A] particular change of trustee . . . might have the effect 

of materially undermining the contemplated qualities or 

independence of trustees. A given change might even 

have the effect of shifting effective control of the trust in 

such a way as to be inconsistent with a protective management purpose or other material purpose of the trust. 

Thus, changes of trustees . . . are to be particularly but 

sympathetically scrutinized for possible conflict with a 

material trust purpose.

Id., comment f. at 481.
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Finally, the comment accompanying § 706 states:

Because of the discretion normally granted to a trustee, 

the settlor’s confidence in the judgment of the particular 

person whom the settlor selected to act as trustee is entitled to considerable weight. This deference to the settlor’s 

choice can weaken or dissolve if a substantial change in 

the trustee’s circumstances occurs.

Unif. Trust Code, supra, § 706, 7D U.L.A. 254.

We understand the commentary set forth above to indicate that the question whether the proposed replacement of 

a trustee is inconsistent with a material purpose of the trust 

depends on the significance to the settlor of the initial choice 

of trustee. For example, there may be cases in which there is 

no indication that the particular trustee or the qualities that 

trustee brought to the assignment were an important consideration for the settlor. In those types of cases—where the 

current trustee is merely an incidental means to accomplish 

ends—removal would not be inconsistent with a material purpose. Courts from other jurisdictions with the same or similar 

“no-fault” removal provisions have reached that conclusion. 

See, e.g., Matter of Trust of Hildebrandt, 53 Kan. App. 2d 

368, 388 P.3d 918 (2017) (where initial trustee was selected 

by drafting attorney without input from settlor, removal 

found not to be inconsistent with material purpose); In re 

McKinney, 67 A.3d 824 (Pa. Super. 2013) (where trustee chosen by settlor no longer existed and material purpose could 

be accomplished by qualified successor trustee, removal 

found not to be inconsistent with material purpose); Fleet 

Bank v. Foote, No. CV020087512S, 2003 WL 22962488 

(Conn. Super. Dec. 2, 2003) (unpublished opinion) (where 

settlor desired only qualified services and initial trustee no 

longer existed, removal found not to be inconsistent with 

material purpose).

On the other hand, however, are cases in which it is important to the settlor that a particular person or entity or a person or entity with particular qualities serve as trustee. The 
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Uniform Trust Code and the Restatement commentary quoted 

above indicate that in those circumstances, replacement of the 

selected trustee with another person or entity or a person or 

entity that lacked the desired qualities would be inconsistent 

with a material purpose.

As noted above, one of Jennifer and Laura’s assignments 

of error is that the county court misapplied the “material purpose” standard of § 30-3862(b)(4) by finding that removal of 

the Bank was not permitted by the terms of the trust. While 

the county court did state at one point in its order that removal 

would be inconsistent “with the clearly stated provisions of 

the trust,” it is not clear to us that the county court failed to 

conduct a proper material purpose inquiry. And, even if it did, 

it is inconsequential, as we are obligated to reach our own conclusion on appeal as to whether removal would be inconsistent 

with a material purpose of the trust. See In re Margaret Mastny 

Revocable Trust, 281 Neb. 188, 794 N.W.2d 700 (2011). We 

proceed to that question now.

Removal of Bank Would Be 

Inconsistent With Material 

Purpose of Trust.

Unlike cases in which the settlor’s considerations must be 

deduced from entirely circumstantial evidence, the record in 

this case contains relatively direct evidence of what Fenske 

hoped to accomplish through the trust and why he selected 

the Bank to serve as trustee. As noted above, Fenske’s attorney, Stafford, provided testimony regarding his understanding 

of Fenske’s estate planning aims. He testified that Fenske’s 

objective was “to keep [the trust assets] together as long as 

[they] could possibly be kept together.” As for why the Bank 

was selected as trustee, Stafford noted that Fenske had a history with the Bank and a relationship with its president and 

that that person was still serving as president of the Bank at 

the time of trial. Stafford also testified that Fenske wanted 

a trustee who was “independent.” Stafford elaborated on the 
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idea of independence when he was asked if someone other 

than the Bank could carry out the material purposes of the 

trust. Stafford responded that “the one thing that I think 

[Fenske] was really trying to get away from was to have any 

of his relatives being in charge of his assets.”

Based on Stafford’s testimony and the terms of the trust, 

the Bank argues that it would be inconsistent with a material purpose of the trust to replace the Bank with Wilson. 

The Bank argues that Fenske wanted the trust to be left intact 

until the deaths of Jennifer and Laura and that it would be 

inconsistent with his purpose if the Bank was replaced by 

Wilson as part of an attempt to ultimately terminate the trust. 

It does appear from both the terms of the trust and Stafford’s 

testimony that it was important to Fenske that the trust assets 

remain intact until the deaths of Jennifer and Laura. Jennifer 

and Laura counter, however, that even if the Bank is correct 

about Fenske’s wishes, Wilson could not thwart those wishes 

as trustee, because he would be bound by the same legal 

requirements as the Bank and the trust could be terminated 

only if permitted by the court under a separate motion under 

§ 30-3837.

In the end, we need not resolve whether and to what extent 

Laura’s admission that this motion is part of an attempt 

to terminate the trust ought to affect the material purpose 

analysis, because even if it is set to the side, we would find 

that removal is inconsistent with a material purpose of the 

trust for another reason. Stafford testified that the Bank was 

selected because Fenske wanted a trustee that was “independent” and that he did not want a trustee that was a part of 

his family. This testimony suggests that the selection of the 

Bank as trustee was more than an incidental means to an end, 

but that independence from his family was, for Fenske, an 

important quality in a trustee. The Restatement comments we 

quoted above recognize that a proposed trustee removal and 

replacement “might have the effect of materially undermining the contemplated qualities or independence of trustees.” 
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Restatement (Third) of Trusts § 65, comment f. at 481 (2003). 

In our view, replacing the Bank with Wilson, Laura’s husband, 

would do so here. Because we find that removal of the Bank 

would be inconsistent with a material purpose of the trust, we 

conclude that the county court did not err in denying Jennifer 

and Laura’s motion.

CONCLUSION

For the foregoing reasons, we affirm the order of the county 

court that denied Jennifer and Laura’s request to remove the 

Bank as trustee.

Affirmed.