Court Opinion

ID: 4515393
Source: CourtListenerOpinion
Date Created: 2020-03-12 13:18:47.444408+00
Date Added: 2024-06-11T08:07:56.624537
License: Public Domain

PRESENT: All the Justices

CHARLES M. HUNTER, JR.
                                                                           OPINION BY
v. Record No. 190260                                                JUSTICE D. ARTHUR KELSEY
                                                                          MARCH 12, 2020
ELEANOR A. HUNTER, IN HER
CAPACITY AS TRUSTEE OF THE
THIRD AMENDED AND RESTATED
THERESA E. HUNTER REVOCABLE
LIVING TRUST AGREEMENT, ET AL.

                        FROM THE CIRCUIT COURT OF THE CITY OF
                        WILLIAMSBURG AND JAMES CITY COUNTY
                                Michael E. McGinty, Judge

        A beneficiary of a living trust filed a declaratory judgment action seeking a judicial

interpretation of two provisions of the trust. In response, the trustee filed a counterclaim seeking

a declaratory judgment that the beneficiary’s action had violated the no-contest provision of the

trust and that, as a result, the circuit court should revoke the beneficiary’s interest in the trust.

Following a hearing on the trustee’s motion for summary judgment on the counterclaim, the

circuit court ruled in favor of the trustee and dismissed the beneficiary’s action with prejudice.

On appeal, the beneficiary argues that the court erred. We agree, reverse the summary judgment,

and remand the case for further proceedings.

                                                   I.

        Charles and Theresa Hunter married in 1953 and had two children, Charles (“Chip”) and

Eleanor, and one granddaughter. Charles and Theresa created separate revocable living trusts in

2010 and 2011, respectively. Charles’s trust named Theresa as the primary beneficiary, and

Theresa’s trust (the “Theresa Trust”) named Charles as the primary beneficiary. Both trusts

named Chip, Eleanor, and the trustee of the granddaughter’s trust as equal contingent

beneficiaries. When Charles died in 2013, all assets in his trust passed outright to Theresa free
of any trust. The Theresa Trust provided that upon the death of both Charles and Theresa, Chip

would receive one-third of the trust assets minus the value of certain loans previously extended

to him and that Eleanor and the trustee of the granddaughter’s trust would also each receive one-

third of the trust assets. The Theresa Trust named Theresa and Eleanor as initial co-trustees, and

if Theresa ever became unable or unwilling to serve as trustee, Eleanor would be the sole trustee.

See J.A. at 252. Chip alleged that “[o]n or after the time that Eleanor began serving as trustee of

the Theresa Trust,” Theresa became incapacitated and “lacked the capacity to revoke the Theresa

Trust.” Id. at 5.

        After Theresa died in 2015, Chip received a brokerage account statement from his sister

that allegedly showed a decline in the value of trust assets from $4.25 million to $1.77 million

over the course of less than 6 years, which was during a period in which stock values had

steadily risen across most market sectors. Chip requested additional information from his sister,

including a full financial report of trust property that detailed receipts, disbursements, liabilities,

trustee compensation, and asset valuations. According to Chip, Eleanor’s counsel refused to

provide the additional information in reliance on a trust provision stating that the settlor

“waive[d] the Trustee’s formal requirements to inform and report set forth under Section

55-548.13 of the Code of Virginia,” id. at 256. 1

        Chip filed this declaratory judgment action, seeking a favorable interpretation of the trust

that would require Eleanor to provide Chip with information and documents related to the trust. 2

        1
         In 2012, the General Assembly repealed Code § 55-548.13 and recodified its language
in current Code § 64.2-775 without any substantive amendments. See 2012 Acts ch. 614, at
1226-27.
        2
          Chip’s complaint sought a judicial interpretation of both Charles’s trust and Theresa’s
trust. The circuit court’s final order stated that, as a matter of law, Chip’s declaratory judgment
action contested the inform-and-report waiver provisions of both Charles’s and Theresa’s trusts
and, as a result, ultimately violated the no-contest provision of the Theresa Trust. On appeal,

                                                    2
Aware of the no-contest provision in the Theresa Trust, Chip divided his declaratory judgment

complaint into two carefully worded counts. Count II acknowledged the ultimate goal of the

litigation by asserting that Chip sought the “determination of the rights of Chip and Eleanor”

under the terms of the Theresa Trust to require the trustee to inform and report under Code

§ 64.2-775, other various provisions of the Virginia Uniform Trust Code, or stand-alone

principles of common law and equity jurisprudence. The rationale behind Count II, as Chip

explained to the circuit court in a subsequent brief, was that he interpreted the language of the

inform-and-report waiver provision to only apply to the duty to inform and report under former

Code § 55-548.13 and to have no effect on what he interpreted as freestanding inform-and-report

duties arising under other sources of law. See R. at 177-85. Based upon prior communications

with Eleanor’s counsel, Chip understood Eleanor’s position to be that the waiver provision

relieved her of any and all inform-and-report duties.

       The complaint expressly sought to create a firewall protecting Count I from any

uninvited, premature consideration of Count II. Prior to the complaint’s allusion to the

competing interpretations of the inform-and-report waiver provision, Count I requested that the

circuit court “initially determine” whether determining Chip’s and Eleanor’s rights and duties

under the trust “would constitute a ‘contest’” under the no-contest provision, thereby triggering

the forfeiture of Chip’s beneficial interest in the trust. J.A. at 3. Count I stated that the court

should consider the request in Count II “if, and only if,” the court interpreted the no-contest

provision to be inapplicable. Id. Relying on our decision in Virginia Foundation of Independent

Colleges v. Goodrich, 246 Va. 435 (1993), the complaint insisted that it sought “no further relief

however, Chip’s assignments of error only address the court’s ruling that he had violated the no-
contest provision of the Theresa Trust. We thus limit our discussion in this opinion to the
Theresa Trust.

                                                   3
than that which has been held by the Virginia Supreme Court . . . to permit a beneficiary to file a

declaratory judgment action seeking an interpretation . . . without such conduct being held to fall

within the scope of a no contest clause and/or actuating a no contest clause.” J.A. at 3. In Count

I, Chip contended that he “merely [sought] an interpretation of the language of the Trusts with

respect to the rights and duties of Chip and Eleanor,” and thus, Count II did not trigger the

application of the no-contest clause. Id. at 11.

        Eleanor responded by filing a counterclaim seeking a declaratory judgment that Chip’s

complaint, when read as a whole, constituted a contest of the Theresa Trust — thereby triggering

the self-executing forfeiture of Chip’s entire beneficial interest in the trust. As Eleanor read the

complaint, Chip was not truly requesting an interpretation but rather was attempting to avoid the

effect of the inform-and-report waiver provision, and thus, Chip was contesting a material term

of the trust.

        When Eleanor filed a motion for summary judgment on her counterclaim, Chip added an

alternative argument in his brief in opposition. Assuming that the court determined (incorrectly,

Chip contended) that no independent duties compelled the trustee to inform and report to

beneficiaries outside of the statutory duty expressly waived by the trust, then both the inform-

and-report waiver provision and the no-contest provision were either “not valid under law” or

“void [as] against public policy.” See R. at 181-86. 3

        3
          This alternative argument was inconsistent with Chip’s complaint, in which he
expressly disclaimed “contest[ing] the Theresa Trust, or any provision of the Theresa Trust,”
J.A. at 10, and contended that he was “merely seek[ing] an interpretation of the language of the
Trusts” in light of alleged inform-and-report duties independent of those waived by the Theresa
Trust, id. at 11. Chip’s complaint does not purport to make any arguments that the trust
provisions are void as against public policy or invalid under law — a point that will become
pertinent later in our analysis. See infra at 19-20.

                                                   4
       Granting summary judgment to Eleanor on her counterclaim, the circuit court agreed with

her characterization of Chip’s complaint, declared that Chip’s beneficial interest in the trust was

revoked, and directed Chip to pay Eleanor’s attorney fees. Chip’s declaratory judgment

complaint, the court ordered, was “dismissed with prejudice in its entirety.” J.A. at 147. The

court did not mention or address the alternative argument raised solely in Chip’s brief in

opposition. Given the circuit court’s ruling that Chip’s complaint contested the trust, it did not

address Chip’s arguments on the proper interpretation of the inform-and-report waiver provision.

                                                 II.

       On appeal, Chip asserts seven assignments of error challenging the circuit court’s final

order. We hold that one of his arguments — challenging the court’s application of the no-contest

clause to his complaint — is dispositive for purposes of this appeal. On this limited ground, we

reverse the circuit court’s summary judgment and remand the case for further proceedings.

                                  A. IN TERROREM PROVISIONS

       Over the centuries, individuals contemplating death have said various things in their wills

to strike terror into the hearts of anyone seeking to undermine their testamentary intent. In

ancient times, the terror was quite real, as the contester could be cast out of the family and lose

its protection. A Mesopotamian will from the thirteenth century B.C. declared that the

disgruntled beneficiary must “set his cloak upon the doorbolt” and then “depart into the street” as

his more respectful brother acquired the entire inheritance. Gerry W. Beyer et al., The Fine Art

of Intimidating Disgruntled Beneficiaries with In Terrorem Clauses, 51 SMU L. Rev. 225, 231

(1998) (quoting 2 The Ancient Near East: A New Anthology of Text and Pictures 80 (James B.

Pritchard ed., 1975)).

                                                  5
        English common law brought many changes to the law of inheritances but did not

preclude the use of in terrorem provisions, though most in terrorem provisions contained mere

admonitions of doom rather than outright forfeiture penalties. Id. at 232 (discussing tenth-

century and eleventh-century wills warning the contester of the “torment of hell” and the “Day of

Judgment”). Following the English tradition, American courts have enforced in terrorem

provisions that seek to disinherit a beneficiary who contests a will or trust. 4 The leading early

precedent, Smithsonian Institution v. Meech, relied on the concept of equitable “election” that

required a beneficiary to elect between taking under an allegedly flawed will or seeking an

abrogation of the will and thus taking nothing. 169 U.S. 398, 414-15 (1898). The underlying

presumption was that the testator had wanted to “guard against vexatious litigation” while not

punishing a beneficiary who merely sought “to ascertain doubtful rights” through a judicial

proceeding. Id. at 413. Many courts have struggled with the boundaries of this concept because

it at once seeks to protect the right of a testator “to dispose of his property as he sees fit,”

Womble v. Gunter, 198 Va. 522, 532 (1956), while not assuming that he wanted to disinherit

anyone who questioned exactly how he intended to do so.

        4
          The use of the expression “in terrorem” was traditionally limited to provisions that
merely sought to dissuade a would-be contester from challenging the testamentary document. In
this respect, in terrorem provisions were “not, in general, obligatory, but only in terrorem”
because “the nonobservance of the conditions” in the provisions would not result in forfeiture.
Smithsonian Inst. v. Meech, 169 U.S. 398, 413 (1898). In modern cases, the expression “in
terrorem” has been expanded generally (depending heavily on the wording of the disputed
provision) to denote forfeiture as well as a mere admonition. See Restatement (Third) of
Property: Wills and Donative Transfers § 8.5 cmt. a (2003) (equating in terrorem provisions to
no-contest provisions in the scope of its discussion of no-contest provisions); George Gleason
Bogert et al., The Law of Trusts and Trustees § 181, at 286 (3d ed. 2012) (noting that “courts
have been called upon to construe these forfeiture clauses also known as in terrorem or no
contest clauses”).

                                                   6
       In Virginia, we believe that the common law honors “the societal benefit of deterring the

bitter family disputes that will contests frequently engender.” Keener v. Keener, 278 Va. 435,

442 (2009) (citing Womble, 198 Va. at 526-27). But we also respect the ancient maxim that

“equity abhors forfeitures,” Jones v. Guaranty & Indem. Co., 101 U.S. 622, 628 (1879), and the

maxim applicable to many platforms of legal doctrine, including wills and trusts, that “provisions

that require forfeiture are not favored in the law,” Rafalko v. Georgiadis, 290 Va. 384, 402

(2015). We have reconciled these competing values by stating that no-contest provisions are

simultaneously “strictly enforced” and “strictly construed.” Id.

       By strictly enforced, we mean that we will enforce the provision without any wincing on

our part concerning its alleged harshness or unfairness — so long as the testator or settlor clearly

intended the forfeiture. By strictly construed, we mean that the intent to forfeit must be very

clear. The language used must “precisely express” the specific intent to cause a forfeiture.

Keener, 278 Va. at 442-43. Strict enforcement cannot be justified by mere inferences of intent.

As in other areas of law, a provision seeking “to sustain forfeiture is construed strictly against

forfeiture,” and thus, “[t]he instrument must give the right of forfeiture in terms so clear and

explicit as to leave no room for any other construction,” Davis v. Wickline, 205 Va. 166, 169

(1964); see Lewis v. Henry’s Ex’rs, 69 Va. (28 Gratt.) 192, 203 (1877) (acknowledging that a

forfeiture will not be sustained “unless it be perfectly clear that the very case has happened in

which it is declared that the interest shall not arise” (emphases in original) (citation omitted)).

When engaged in that interpretative process, a Virginia “chancellor will not lift his hand to aid a

litigant in enforcing a forfeiture.” Pence v. Tidewater Townsite Corp., 127 Va. 447, 459 (1920)

(citation omitted). The heavy lifting must be done entirely by the unmistakable language of the

drafter of the putative forfeiture provision.

                                                  7
        The principle of strict construction applies with compounding force to no-contest

provisions in trusts. We have recognized that no-contest provisions are prima facie valid in trust

instruments just as they are in wills. See Keener, 278 Va. at 442. That recognition, however,

was of recent provenance. We have yet to address how the unique attributes of trusts should

factor into the legal analysis or to consider the distinguishing fact that

                trusts differ from wills because they usually last for an extended
                period of time and because, during that period, they vest ownership
                and control of the property in the hands of a trustee. Indeed, the
                fiduciary relationship between the property’s legal owner — the
                trustee — and the property’s beneficial owners is the cornerstone
                of trust law. The rising use of expansive trust forfeiture clauses is
                problematic because by disinheriting beneficiaries who seek
                oversight of this fiduciary relationship, the clauses threaten to
                forfeit trust altogether.

Deborah S. Gordon, Forfeiting Trust, 57 Wm. & Mary L. Rev. 455, 474 (2015) (footnotes

omitted). 5 Although Chip advances several arguments in this case that build upon this premise,

we need not address the outer boundaries of no-contest provisions in trust instruments. We

instead focus our attention on the narrow dispute before us and ask only whether the circuit court

correctly ordered the forfeiture of Chip’s interest in the Theresa Trust pursuant to this particular

trust’s no-contest provision. 6

        5
          Courts and commentators have struggled with this issue. See, e.g., Callaway v. Willard,
739 S.E.2d 533, 536-37 (Ga. Ct. App. 2013); Restatement (Third) of Trusts § 96(2) & cmt. e
(2012); Bogert et al., supra note 4, § 965, at 108-09 (3d ed. 2010); George Gleason Bogert &
George Taylor Bogert, The Law of Trusts and Trustees § 973, at 248-49, 252-53 (2d ed. 1962);
Charles E. Rounds, Jr. & Charles E. Rounds, III, Loring and Rounds: A Trustee’s Handbook
§ 5.5, at 436 (2018 ed.); Lynn Foster, Arkansas’s Trust Code and Trust Planning: A Ten-Year
Perspective, 38 U. Ark. Little Rock L. Rev. 301, 342 (2016). Given our narrow holding, we
leave for future consideration how, if at all, these observations affect the ultimate scope of no-
contest provisions in trust instruments that seek to shelter fiduciary misfeasance or malfeasance.
        6
          It is significant that the Theresa Trust provided that Chip’s interest, in the event of
forfeiture, would be distributed in equal shares to the trustee of the granddaughter’s trust and to
Eleanor, see J.A. at 251. With respect to devises of personal property, English and early
American courts required the testator to provide a gift over to another to disaffirm any inference

                                                   8
                     B. THE NO-CONTEST PROVISION IN THE THERESA TRUST

       The circuit court held that Chip’s declaratory judgment action was a thinly veiled attempt

to require Eleanor, in her capacity as trustee, to provide financial data regarding trust property in

violation of a trust provision that expressly waived her duty to do so. Viewing the complaint in

its totality, the court concluded that it violated the no-contest provision and thereby triggered a

complete forfeiture of Chip’s interest in the Theresa Trust.

       On appeal, Chip contends that the circuit court’s holding started at the end, not the

beginning, of the proper analysis. The court characterized Count II, which Chip claimed was

merely a request for a judicial interpretation of the inform-and-report waiver provision, as a

request to judicially render the provision unenforceable or to avoid the effect of the provision.

From there, Chip argues, the court erroneously backed into Count I and found that Chip’s request

to judicially render the waiver provision unenforceable had violated the no-contest provision.

The court then enforced the no-contest provision and ordered the forfeiture of Chip’s interest in

the Theresa Trust.

       Chip reasons that the correct analysis should have begun with Count I, which sought an

interpretation of the no-contest provision to determine if Count II would violate that provision.

that the forfeiture provision was merely in terrorem and that the testator had merely “intended
only to frighten the beneficiary to comply.” Martin D. Begleiter, Anti-Contest Clauses: When
You Care Enough to Send the Final Threat, 26 Ariz. St. L.J. 629, 649 (1994). In Womble v.
Gunter, we observed that the gift-over rule had been “disregarded” in several jurisdictions and
had been mentioned only “by way of dictum” in one of our earlier cases. 198 Va. at 524-25
(citing Fifield v. Van Wyck’s Ex’r, 94 Va. 557, 563-64 (1897)); see also Maddox v. Maddox’s
Adm’r, 52 Va. (11 Gratt.) 804, 810-11 (1854). The best synthesis of the gift-over rule, however,
came from Justice Story. He explained that, the presence or absence of a gift over “might have a
bearing” on the question of a drafter’s intention but that it “should not be decisive.” 1 Joseph
Story, Commentaries on Equity Jurisprudence § 386, at 365 (W.H. Lyon, Jr. ed., 14th ed. 1918).
Chancellor Kent agreed with this view, James Kent, Commentaries on American Law 132 (4th
ed. 1840), as do we. See generally Restatement (Third) of Property: Wills and Donative
Transfers § 8.5 cmt. h.

                                                  9
If so, the complaint expressly denied any request for a judicial resolution of Count II. The

complaint expressly sought resolution of Count II “if and only if” the court interpreted Count II

as not violating the no-contest provision. J.A. at 3, 12, 13 (punctuation omitted). 7

       Under Chip’s approach, the proper analysis could lead to only two possible outcomes. If

the circuit court believed that deciding Count II on the merits would violate the no-contest

provision, then Count II under its own self-executing terms would be withdrawn, leaving Chip

with whatever interest he had in the trust but without any additional financial information from

Eleanor about the trust property. On the other hand, if the court believed that resolving Count II

would not violate the no-contest provision, then the court could make a determination on Count

II and resolve whether the inform-and-report waiver provision, when properly interpreted, had

any effect on Eleanor’s “independent duty,” id. at 203, to provide the financial information to

Chip. That independent duty, he argued, arose either under various provisions of the Virginia

Uniform Trust Code or under common-law and equitable principles “separate and apart from

statutory law in Virginia,” id. at 203-05, and thus could not be extinguished by a provision

waiving only the trustee’s statutory duties under former Code § 55-548.13.

                                                 1.

       Chip’s arguments require that we reframe the ultimate question: Did his complaint, taken

as a whole or analyzed count-by-count, violate the no-contest provision of the Theresa Trust and

thus require the forfeiture of his interest in the trust? We answer that question in the negative.

       We addressed an alternatively pleaded complaint in Goodrich, in which a beneficiary of a

will filed a declaratory judgment action “seeking an interpretation of a phrase in the will.” 246

       7
         Throughout his briefs and oral argument in the circuit court, Chip repeated this
qualification. See J.A. at 198, 200-01; R. at 173, 176-77.
10
Va. at 437. The executor interpreted the phrase “personal property” to mean only tangible

personal property, but the beneficiary believed that the phrase included both tangible and

intangible personal property. Id. The beneficiary insisted that he was not contesting the phrase

itself, only the executor’s flawed interpretation of it. See id.

       The will in Goodrich contained a no-contest provision which, if triggered, would have

caused the forfeiture of the beneficiary’s interest if his complaint were construed as a contest of

the personal-property provision. The beneficiary’s complaint sought to navigate through those

straits by “request[ing] the trial court initially to determine whether his declaratory judgment

action was a ‘contest’ under [the no-contest clause], which would result in forfeiture of his

interests under the will.” Id. The court should “proceed with a determination of the phrase

‘personal property,’” the complaint clarified, “[i]f and only if” the court determined that doing so

would not constitute a contest triggering a forfeiture. Id. (punctuation omitted). In this way, the

beneficiary emphasized that he was filing a will-construction case and not a will-contest case.

       The circuit court accepted that qualification, holding that the declaratory judgment action

did not constitute a contest of the will. We agreed and explained:

               As a general principle, one who seeks the guidance of a court in
               interpreting a provision in a will is not considered to have
               “contested” the will in a manner which would actuate a forfeiture
               clause. While forfeiture clauses or “no contest” clauses effectuate
               the testator’s legitimate interest in preventing attempts to thwart
               his intent, a request for interpretation does not challenge the intent
               of the testator or the validity of the will.

Id. at 438. We recognized, as framed in the Goodrich litigation, that the beneficiary simply

“believed the executor’s interpretation of a phrase in the will was wrong” and sought the court’s

approval of his interpretation “only on the condition that seeking the guidance did not contravene

the ‘no contest’ provision . . . of the will.” Id. at 440. Implicitly approving the beneficiary’s use

                                                  11
of alternative pleading in this context, we affirmed the circuit court’s holding that the declaratory

judgment action had not triggered the no-contest provision. 8

       We now give our express approval to the alternative-pleading model implicitly accepted

in Goodrich. The alternative-pleading model has the virtue of principle by conforming to the

traditional view that the complainant is “the master of the complaint,” Holmes Grp., Inc. v.

Vornado Air Circulation Sys., Inc., 535 U.S. 826, 831 (2002) (citation omitted), and the value of

pragmatism by permitting a declaratory judgment action to gauge the cost-benefit ratio of

continuing litigation, see Cherrie v. Virginia Health Servs., Inc., 292 Va. 309, 318 (2016)

(recognizing that the Declaratory Judgment Act provides a “procedural remedy for the unripe,

but legally viable, cause of action”).

       Count I of Chip’s complaint closely followed the Goodrich template for seeking a

preliminary determination on the scope of the no-contest provision in the Theresa Trust prior to a

resolution of the disputed meaning of the inform-and-report waiver provision:

               Notwithstanding anything that may be contained in this Complaint
               to the contrary, this Complaint seeks no further relief than that
               which has been held by the Virginia Supreme Court in Virginia
               Foundation of Independent Colleges v. Goodrich, 246 Va. 435
               (1993), to permit a beneficiary to file a declaratory judgment
               action seeking an interpretation of a phrase in a testamentary
               instrument, without such conduct being held to fall within the
               scope of a no contest clause and/or actuating a no contest clause.
               Consistent with Goodrich, this Complaint requests that the Court
               initially determine whether a declaratory judgment action (with
               respect to a determination of the rights and duties of Chip and
               Eleanor under the terms of the Trusts in light of Virginia Code
               Section 64.2-775, the Virginia Uniform Trust Code, Virginia
               common law, and/or equitable principles of law) would constitute
               a “contest” under either of the no contest clauses contained in the
               Trusts; and if, and only if, the Court determines that it would not

       8
          See John F. Kuether, Significant Probate and Trust Decisions, 31 Real Prop. Prob. &
Tr. J. 129, 153 (1996) (recognizing that Goodrich provided “guidelines that allow practitioners to
safely deal with questions regarding testamentary forfeiture clauses”).

                                                 12
               constitute a “contest” under the no contest clauses contained in the
               Trusts, this Complaint asks the Court to then proceed with a
               determination of the rights and duties of Chip and Eleanor under
               the terms of the Trusts in light of Virginia Code Section 64.2-775,
               the Virginia Uniform Trust Code, Virginia common law, and/or
               equitable principles of law.

J.A. at 3 (emphasis added).

       The complaint goes on to assert that it did not seek to “contest” the Theresa Trust or any

of its provisions but rather sought only “an interpretation of the trustee’s inform and report

requirements” under the specific “language” of the trust and under any independent duties of this

kind pursuant to “Code Section 64.2-775, the Virginia Uniform Trust Code, Virginia common

law, and/or equitable principles of law.” Id. at 10-11. These allegations fit squarely within the

Goodrich alternative-pleading model, and thus, we next address whether Count II of Chip’s

complaint violated the no-contest provision of the Theresa Trust.

                                                 2.

       The circuit court held that Count II of the complaint had triggered the no-contest

provision and, on this basis, ordered the forfeiture of Chip’s interest in the Theresa Trust. Even

if it were true that Count II had violated the no-contest provision, the court erred by disregarding

the if-and-only-if proviso of Count I and ordering a forfeiture based upon Count II. Instead, in

such a scenario, the circuit court should have entered judgment on Count I in Eleanor’s favor and

dismissed Count II as moot.

       That said, we do not accept the first premise of the circuit court’s reasoning that Count II

violated the no-contest provision. Whether such a violation has occurred “depends upon the

wording of the ‘no contest’ provision and the facts and circumstances of each particular case.”

Womble, 198 Va. at 529; see also Goodrich, 246 Va. at 439. In the first paragraph of the self-

styled “IN TERROREM PROVISION” of the trust, Theresa provided background context

                                                 13
explaining her intent:

                       I have from time to time made gifts and provided
               financial support to each of my children and to my grandchild
               as I wished, and as my husband and I determined to be
               necessary to their circumstances. Except as otherwise expressly
               set forth in this document, the share for any beneficiary
               hereunder shall not be affected by any gifts or loans to any
               beneficiary hereunder.

J.A. at 254. The next paragraph of the no-contest provision begins: “I desire that my

children and grandchild not expend resources disputing loans, gifts or bequests that I have

made.” Id. (emphasis added). Theresa then sought to enforce that desire by declaring:

               Therefore, if any beneficiary under this Trust Agreement takes
               any one or more actions described in this paragraph, then the
               interest of such beneficiary under this Trust Agreement shall be
               revoked, and such beneficiary shall be deemed to have predeceased
               me without surviving descendants for all purposes under this Trust
               Agreement, effective as of the date such action is taken.

Id. One of the “actions” triggering the forfeiture was “[c]ontest[ing] any provision of this Trust

Agreement.” Id.

       The no-contest provision provided a specific definition for a prohibited “contest” of the

trust: “For purposes of this Article, a person shall be deemed to contest an instrument or action,

if he or she takes any action seeking to invalidate, nullify, set aside, render unenforceable, or

otherwise avoid the effect of such instrument, action or transaction.” Id. at 255. A caveat,

however, followed this definition:

               The preceding paragraph shall take effect regardless of whether
               such contest is made in good faith or is ultimately successful,
               provided, however that a petition made in good faith and not
               objected to by my Trustee hereunder, seeking an interpretation of
               this or any other instrument, shall not be considered a contest of
               such instrument.

Id.

                                                 14
       Focusing on the sentence defining “contest,” Chip asserts that Count II never sought to

“invalidate, nullify, set aside, render unenforceable, or otherwise avoid” any provision of the

Theresa Trust. Id. Nor did he violate his mother’s “desire” that no beneficiary should “expend

resources disputing loans, gifts or bequests” that she had previously made. Id. at 254. Instead,

when properly construed, Count II merely sought an interpretation of the trustee’s inform-and-

report duties under other sources of law that would be wholly unaffected by the waiver

provision. The circuit court disagreed with Chip and ordered the forfeiture of his interest in the

trust. We believe the court erred in doing so.

       Construing a legal document and contesting it are two different things. 9 The distinction

may be fine, but it is a sharp one. A successful construction of an instrument can, and usually

does, eliminate any need to contest it. Count II of Chip’s complaint sought the former and

expressly eschewed the latter. Under Chip’s interpretation, the inform-and-report waiver

provision did not need to be invalidated. Properly construed, he argued, the provision’s literal

text did not apply to independent inform-and-report duties arising under other sources of law.

Rather, the text merely waived one specific statutory duty to inform and report “set forth” (as the

waiver provision states) in former Code § 55-548.13. J.A. at 256.

       The problem with the circuit court’s conclusion — that Chip was seeking to avoid the

effect of the waiver provision — is that buried within it is an implicit rejection of Chip’s narrow

interpretation of the provision in favor of Eleanor’s broad interpretation. Working from that

       9
         We acknowledge the linguistic distinctions commonly drawn (and yet often criticized)
between the terms construction and interpretation. Compare Henry Campbell Black, Handbook
on the Construction and Interpretation of the Laws 1-3 (2d ed. 1911), with Antonin Scalia &
Bryan A. Garner, Reading Law: The Interpretation of Legal Texts 13-15 (2012). In the unique
context of no-contest provisions in estate planning documents, however, courts use the terms
interchangeably. We do as well.

                                                 15
apparent assumption, the court equated Chip’s disagreement with the broad interpretation as an

outright contest of the provision itself. The point of Goodrich, however, was to provide a safe

harbor for seeking a judicial interpretation of a disputed provision without the risk of the request

for interpretation being characterized as an attempt to invalidate the provision.

       Given our holding, we need not offer any opinion on the proper interpretation of the

inform-and-report waiver provision in the Theresa Trust. We only observe that the parties

presented the circuit court with differing interpretations, and the court appeared to assume that

one was correct and the other not. For that assumption to be true, the circuit court would have

had to determine either (i) that the provision waived not only the statutory inform-and-report

duty specifically referenced but also all other analogous duties arising elsewhere in the law or (ii)

that the waiver provision waived the one and only basis for imposing such inform-and-report

duties on a trustee because the specified statute codified in toto any and all other legal and

equitable grounds for asserting a breach of these duties. The circuit court could not have reached

either of these two conclusions without construing the waiver provision.

       In Goodrich, we recognized that seeking the “guidance of a court in interpreting” a

disputed provision of a will does not constitute contesting the will “in a manner which would

actuate a forfeiture clause.” 246 Va. at 438. The same is true in trust law. In cases where a

beneficiary files a declaratory judgment action “to construe the terms of the trust, it is usually

held that the beneficiary’s conduct did not bring the forfeiture clause into effect since the suit

was intended to determine rather than oppose the settlor’s intent.” Bogert et al., supra note 4,

§ 181, at 292. “The primary justification for distinguishing this type of action is that it involves

beneficiaries who are seeking to clarify what the testator actually meant and therefore to

implement, rather than impede, the testator’s intent.” Gordon, supra, at 471-72.

                                                 16
        Eleanor acknowledges this general rule but argues that the no-contest provision in the

Theresa Trust required forfeiture even if Chip sought only a judicial interpretation of its

provisions. Skipping over the sentence defining “contest,” Eleanor lays emphasis on the proviso

that follows. That proviso, broken out below for clarity, purports to recognize an exception to

the no-contest provision:

             •   provided, however that a petition

                            o made in good faith and

                            o not objected to by my Trustee hereunder,

                            o seeking an interpretation of this or any other instrument,

             •   shall not be considered a contest of such instrument.

See J.A. at 255 (emphases added). Eleanor argues that this proviso extends the no-contest

provision to a beneficiary’s good faith petition for a judicial interpretation of the trust if she, as

trustee, objects to the request. To her, the meaning of the provision is quite clear: A request for

a judicial interpretation of the trust constitutes a contest triggering forfeiture so long as she says

so. We have several concerns about this argument.

        To begin, we have never addressed (much less approved) a no-contest provision seeking

to seal the courthouse doors to a litigant seeking an interpretation (rather than an invalidation) of

a trust or will provision. Several courts 10 have criticized such an effort as an impermissible

overreach inconsistent with the traditional boundaries of no-contest provisions. Leading

        10
          See, e.g., Smithsonian Inst., 169 U.S. at 413; Goodrich, 246 Va. at 438; Estate of
Strader, 132 Cal. Rptr. 2d 649, 655 (Ct. App. 2003); Griffin v. Sturges, 40 A.2d 758, 760 (Conn.
1944); Black v. Herring, 28 A. 1063, 1065 (Md. 1894). See generally Claudia G. Catalano,
Annotation, What Constitutes Contest or Attempt To Defeat Will Within Provision Thereof
Forfeiting Share of Contesting Beneficiary, 3 A.L.R. 5th 590, § 15[a] (1992) (collecting cases).

                                                   17
commentators have taken a similar view. 11 We need not resolve that question in this case,

however, because the proviso Eleanor relies upon merely implies, but does not expressly state,

that her mother intended to include a request for judicial interpretation within the definition of a

contest, thus warranting a forfeiture. In this area of legal draftsmanship, mere implications will

not suffice.

        As we noted earlier, forfeiture provisions are “strictly construed,” Rafalko, 290 Va. at

395, because “equity abhors forfeitures,” Jones, 101 U.S. at 628, and because “provisions that

require forfeiture are not favored in the law and will not be enforced except according to their

clear terms,” Rafalko, 290 Va. at 402. To be effective, the provision must “precisely express” an

intent to cause a forfeiture. Keener, 278 Va. at 443. “The instrument must give the right of

forfeiture in terms so clear and explicit as to leave no room for any other construction.” Davis,
205 Va. at 169. These canons of construction have great weight in the context of a no-contest

provision in a trust instrument since a trust’s very identity as a creature of equity presupposes the

possibility of oversight of the trustee by a chancellor jealous of safeguarding the rights of all

parties with an interest in the trust.

        Strictly construed, the proviso in the no-contest provision of the Theresa Trust does not

equate a request for an interpretation of the trust’s provisions with a contest of the trust. Instead,

the no-contest provision enumerates the actions constituting a “contest” as “any action seeking to

invalidate, nullify, set aside, render unenforceable, or otherwise avoid the effect of such

instrument, action or transaction.” J.A. at 255. These verbs — invalidate, nullify, set aside,

render unenforceable, and avoid the effect of — are not synonyms for interpret.

        11
          See, e.g., Restatement (Third) of Trusts § 96 cmt. e (2012); Restatement (Third) of
Property: Wills and Donative Transfers § 8.5 cmt. d; Bogert et al., supra note 4, § 181, at 292;
Rounds & Rounds, supra note 5, § 5.5, at 436.

                                                 18
       The proviso purports to remove an action (a request for judicial interpretation) from a list

in which the action never appeared in the first place. The proviso states that Eleanor, as trustee,

can agree that a request for an interpretation is not a contest. The proviso thus assumes that a

request for an interpretation has already been defined as a “contest” by the no-contest clause —

thus creating the need for a proviso that excises “interpretation” from that definition in certain

circumstances. By doing so, the proviso makes a tautological assertion “in which the point to be

proved is implicitly taken for granted,” Black’s Law Dictionary 189 (11th ed. 2019), a classic

example of begging the question. One does not need an exception to a rule to do something the

rule does not prohibit.

       For these reasons, the principles of strict construction dictate that neither the definition of

“contest” nor the proviso’s attempted exception from that definition clearly and unmistakably

states that either count of Chip’s declaratory judgment action violates the no-contest provision by

seeking an interpretation of the trust and, based thereon, a declaration of the trustee’s duties. The

circuit court erred in concluding otherwise.

                                                 C.

                                                 1.

       Our discussion thus far has centered on Chip’s declaratory judgment complaint because

that was what was dismissed “with prejudice in its entirety” by the entry of summary judgment.

J.A. at 147. We have not addressed the alternative argument that Chip asserted on brief in the

circuit court and repeated to us on appeal. That argument suggested that, if the inform-and-

report waiver and no-contest provisions were incorrectly interpreted to erect an impregnable

barrier to judicial review of a fiduciary’s duty to inform and report, then neither provision would

be enforceable as a matter of law. We have little doubt that this claim, if Chip had pleaded it in

                                                 19
his complaint, could have been challenged as a contest of either the no-contest or the waiver

provisions of the Theresa Trust. The circuit court never got that far, however, because of its

view that, even without that alternative argument, the complaint itself (which sought only an

interpretation of the trust) constituted a contest triggering the no-contest provision.

       We, too, do not reach this alternative argument but for reasons different than those

identified by the circuit court. While Chip’s alternative argument raises important questions

about the conjoined application of no-contest and inform-and-report waiver provisions in trust

instruments that would be issues of first impression for this Court, see supra at 8 & n.5, these

questions are not ripe for review. Chip never pleaded that argument, and expressly disclaimed it

in his declaratory judgment complaint, see J.A. at 10-11. The circuit court, moreover, has yet to

rule on Chip’s principal arguments regarding the proper interpretation of the inform-and-report

waiver provision and the role, if any, of independent legal and equitable duties to inform and

report beyond the statutory duties specifically mentioned in the waiver provision.

       “Because ‘we are a court of review, not of first view,’” Bailey v. Loudoun Cty. Sheriff’s

Office, 288 Va. 159, 181 (2014) (quoting Cutter v. Wilkinson, 544 U.S. 709, 718 n.7 (2005)); see

also CVAS 2, LLC v. City of Fredericksburg, 289 Va. 100, 120 (2015), we leave Chip’s

alternative argument for the circuit court to consider in the first instance on remand, assuming

that Chip properly asserts it and that the court’s resolution of the principal arguments does not

render it moot. Offering an advisory opinion on this issue in the present appeal would represent

an attenuated exercise of judicial power in which this Court “traditionally declines to

participate,” Commonwealth v. Harley, 256 Va. 216, 219-20 (1998).

                                                  2.

       We likewise offer no opinion on Eleanor’s argument on appeal that she had no duty at all

                                                 20
as trustee to inform and report to the beneficiaries about the trust property before Theresa’s death

in 2015 because the trust was revocable at that time and did not become irrevocable until

Theresa’s death. See Appellee’s Br. at 1-2, 23-25, 40. This argument responds to Chip’s

contrary allegation in his complaint that “[o]n or after the time that Eleanor began serving as

trustee of the Theresa Trust, Theresa’s abilities declined, such that Theresa lacked the capacity to

revoke the Theresa Trust.” J.A. at 5. Though the argument raises pertinent legal issues, 12 the

circuit court made no factual findings about Theresa’s capacity or the nature of Eleanor’s duties

as trustee of the Theresa Trust prior to Theresa’s death. We thus decline to consider these issues

on appeal and leave them for the circuit court to address in the first instance on remand if the

parties raise them.

                                                  III.

       In sum, the declaratory judgment action did not trigger the no-contest provision in the

Theresa Trust requiring the forfeiture of Chip’s interest in the trust. For this reason, we reverse

the circuit court’s summary judgment dismissing Chip’s complaint and remand the case for

further proceedings consistent with this opinion.

                                                                             Reversed and remanded.

       12
            See Code § 64.2-750 (“The capacity required to create, amend, revoke, or add property
to a revocable trust, or to direct the actions of the trustee of a revocable trust, is the same as that
required to make a will.” (emphasis added)); Code § 64.2-752(A) (“While a trust is revocable,
rights of the beneficiaries are subject to the control of, and the duties of the trustee are owed
exclusively to, the settlor.”). See generally Bogert et al., supra note 4, § 964, at 101-05 (3d ed.
2010) (noting that the Uniform Trust Code originally provided “that the trustee’s duties were
owed exclusively to the settlor only if the settlor had capacity to revoke the trust” but that later
amendments made this limitation optional so that without the limitation “the trustee cannot be
held to account by other beneficiaries for its administration of a revocable trust during the
settlor’s lifetime” regardless of the settlor’s capacity (emphasis added)).

                                                  21