Opinion ID: 2570679
Heading Depth: 1
Heading Rank: 5

Heading: Allocation of Assets

Text: [¶ 21] It is contended by Orlan Garwood and Carol Jones that the district court, and this Court, must confine its search for an answer to the question of how the assets are to be apportioned between the two Trusts, to the Trust documents themselves, and that the Trust documents do not permit the allocation fashioned by the district court. See Kerper v. Kerper, 780 P.2d 923, 934 (Wyo.1989). We have held that parties making an agreement are presumed to know the law and to contract with reference to the law. Walliker v. Escott, 608 P.2d 1272 (Wyo.1980). Moreover, our precedents counsel that the parties to a contract are presumed to know its terms. Czapla v. Grieves, 549 P.2d 650 (Wyo.1976). Furthermore, it is contended that a failure of the courts to give full recognition to the terms of these Trusts will frustrate Mildred Garwood's estate planning scheme. Moreover, in its Judgment the district court failed to take into account the interests of the residuary beneficiaries. It is the contention of Orlan Garwood and Carol Jones that Mr. Garwood used $242,303.00 from the Family Trust in violation of the terms of the Trust and he must reimburse the Trust for those amounts. In addition, Mr. Garwood should reimburse the Family Trust for the $31,405.00 that Mr. Garwood used to pay for his wife's final illness and funeral expenses. It is also claimed that the district court erred in allowing Mr. Garwood credit for $67,670.00 for living expenses because it did not take into account his monthly income from other sources during that period of time. Finally, they contend that Judy Kechter must refinance the loan made to her by her father and then her father can use that money to repay the Family Trust. [¶ 22] We conclude that the district court's findings of fact are not clearly erroneous and its application of the law to these circumstances is likewise not erroneous. The Garwoods had the misfortune to fall victim to an itinerate hawker of fill-in-the-blank, one-size-fits-all, trust forms. The materials were ill-suited to the Garwoods' needs and have served to squander a significant portion of their hard-earned life savings on legal proceedings and attorney's fees (we are given to understand from the briefs that the Trusts have paid over $49,000.00 in attorney's fees incurred by Orlan Garwood and Carol Jones, and that there is only slightly more than $16,000.00 left in the Family Trust). Clearly there is no pot of gold at the end of the rainbow for anyone involved in this litigation, most certainly not for the 84-year-old Mr. Garwood who is dependent on the income from the Trust to eke out his subsistence standard of living for the remainder of his days. [¶ 23] The district court has fashioned a suitable and practical resolution to the problems brought before it: ... [T]he court possesses and frequently exercises the power, on the application of the trustee or one or more beneficiaries, to modify the terms of the trust in order to effectuate the accomplishment of the purposes of the settlor. Where administrative provisions handicap the trustee, or the trustee lacks an essential power, the court frequently releases the trustee from the objectionable provision, or grants the needed authority, or otherwise changes the trust as to methods of operation, so as to enable the trustee to achieve the primary purposes of the settlor. Statutes in many states authorize the court to modify or terminate the trust on a finding that the fulfillment of the settlor's purpose has become impossible or impracticable. Mary F. Radford and George Gleason Bogert, The Law of Trusts and Trustees § 994, at 182-86 (2006); State v. Underwood, 54 Wyo. 1, 86 P.2d 707, 725 (1939); In re Joint Eastern and Southern Districts Asbestos Litigation, 878 F.Supp. 473, 536-540 (E.D.N.Y and S.D.N.Y.1995); and see Wyo. Stat. Ann §§ 4-10-105(a)(iv); 4-10-106, 4-10-201; 4-10-413, 4-10-415, 4-10-416 (LexisNexis 2007). It is not clear from the record below exactly which of its statutory, common law or equitable powers the district court relied upon in deciding this case, but it suffices here to note that any one or more of them could form a solid basis for the district court's resolution of this case. [¶ 24] In summary, we conclude that the district court's factual findings are not clearly erroneous, and its disposition of the issues raised herein is sound as a matter of law.