Opinion ID: 1574529
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Heading: Co-trustees' Motion to Dismiss.

Text: To support their motion to dismiss, the co-trustees rely solely on the Iowa Code section that provides: Unless previously barred by adjudication, consent, or other limitation, a claim against a trustee for breach of trust is barred as to a beneficiary who has received a final account or other report adequately disclosing the existence of the claim, unless a proceeding to assert the claim is commenced within one year after the earlier of the receipt of the accounting or report of the termination of the trust relationship between the trustee and beneficiary. Iowa Code § 633A.4504(1). The co-trustees make two arguments under this section. First, they argue the trust proceedings in the probate court barred Turner's claims in this action based on the theory of res judicata, issue preclusion, or claim preclusion. Second, they argue the one-year statute of limitations contained in section 633A.4504(1) bars Turner's claims. The co-trustees make no claim that should the court consider the uncontroverted allegations as true, Turner's petition fails to state a claim recognized by Iowa law. A. Res Judicata, Issue Preclusion, or Claim Preclusion. To decide this issue it is necessary for the court to have before it the appropriate court records from the prior case upon which the co-trustees claim the theory of res judicata, issue preclusion, or claim preclusion bars the present claims. In a motion to dismiss based on the plaintiff's failure to state a claim upon which any relief may be granted, the court can only consider the well-pled facts, not the factual allegations contained in the motion or the documents attached to the motion. Berger, 268 N.W.2d at 634. Turner's petition contains none of the necessary allegations or documents to support the co-trustees' position that Turner's claims are barred by the theory of res judicata, issue preclusion, or claim preclusion. Even if we were to take judicial notice of the probate action where the court of appeals affirmed the closing of the trust and the discharging of the trustees, we cannot say with any certainty the issues raised in the probate action are identical to those raised in Turner's petition in the present case. Accordingly, at this stage of the proceedings we cannot determine if the theory of res judicata, issue preclusion, or claim preclusion bars Turner's claims. See Johnson v. Ward, 265 N.W.2d 746, 749 (Iowa 1978) (holding res judicata can be raised by a motion to dismiss if the nature of the prior adjudication appears on the face of the petition or arises from taking judicial notice of the petitions in pending cases, from which it is indisputable that they present identical causes of action against the defendant); see also Smith v. Smith, 513 N.W.2d 728, 731 (Iowa 1994) (holding a defense of res judicata cannot be raised by a motion to dismiss); Bickford v. Am. Interinsurance Exch., 224 N.W.2d 450, 454 (Iowa 1974) (same). These defenses are better suited to be raised through a motion for summary judgment, where the necessary supporting documentation can be submitted for consideration by the court in ruling on the motion. B. Statute of Limitations. A defendant may raise the statute of limitations by a motion to dismiss if it is obvious from the uncontroverted facts contained in the petition that the applicable statute of limitations bars the plaintiff's claim for relief. State ex rel. Krupke v. Witkowski, 256 N.W.2d 216, 218 (Iowa 1977). The co-trustees argue Turner's claims are barred by the one-year limitation period found in section 633A.4504(1). The limitations provision of this section bars a beneficiary's claim against a trustee for a breach of trust by a beneficiary who has received a final account or other report adequately disclosing the existence of the claim, unless a proceeding to assert the claim is commenced within one year after the earlier of the receipt of the accounting or report of the termination of the trust relationship between the trustee and beneficiary. Iowa Code § 633A.4504(1). In order to sustain the co-trustees' motion to dismiss, the uncontroverted allegations of Turner's petition must establish: (1) he is a beneficiary of the trust; (2) the claim against the co-trustees is for a breach of trust; (3) Turner received a final account or other report adequately disclosing the existence of the claim; and (4) he failed to commence his action within one year after the earlier of the receipt of the accounting or report of the termination of the trust relationship between the trustees and beneficiary. The uncontroverted allegations of Turner's petition establish the first element. He is a beneficiary of his father's residuary trust. However, we cannot conclude under this record whether the second element is establishedthat Turner's claims against the co-trustees are for a breach of trust. A trustee breaches his duty of trust when he violates a duty owed to the beneficiary. Iowa Code § 633A.4501. The Iowa Trust Code contains numerous duties a trustee must perform. These include the duty to administer the trust in accordance with the terms of the trust and the trust code, id. § 633A.4201; the duties of loyalty, impartiality, and confidentiality, id. § 633A.4202; the duty to inform and account, id. § 633A.4213; and the duty to manage the assets of the trust prudently, id. § 633A.4302. The Iowa Trust Code contains the remedies a beneficiary may seek for a breach of trust. Id. §§ 633A.4502-03. Turner's first claim is for the co-trustees' failure to pay Turner's legal fees arising from his successful defense of the criminal trespass charge. Although Turner is a beneficiary of the trust, viewing the allegations of the petition in the light most favorable to him, Turner is alleging he is entitled to reimbursement for these fees as a creditor of the trust. Therefore, we cannot say the uncontroverted facts of the petition establish this claim as one for breach of trust. Turner's second and third claims involve the co-trustees' interference with the family settlement agreement and a lawsuit between him and his mother. The co-trustees' motion to dismiss did not challenge whether such actions are maintainable under Iowa law, rather they argue these actions are nothing more than breach-of-trust claims that are barred by the statute of limitations contained in section 633A.4504. In these claims, Turner alleges the co-trustees did not breach a duty owed to him as a beneficiary, but that the co-trustees tortiously interfered with the family settlement agreement and the lawsuit with his mother. If we assume for the purposes of this opinion Turner's claims of tortious interference are actionable under Iowa law, these are not breach-of-trust claims. Rather these are independent claims outside the purview of the trust code. See Huffey v. Lea, 491 N.W.2d 518, 520 (1992) (reaffirming that Iowa recognizes an independent action outside the probate code for tortious interference with a bequest). Therefore, these claims may not be subject to the one-year limitation contained in section 633A.4504(1). See Frohwein v. Haesemeyer, 264 N.W.2d 792, 793-95 (1978) (holding the tort of intentional interference with a bequest is an independent claim and not subject to the limitations period of the probate code).