In re the Trust of the Elvira Ruth Halvorson Revocable Living Trust Created under Agreement by Elvira Ruth Halvorson, Settlor, and Elvira Ruth Halvorson, Trustee, dated September 26, 2009, as amended.

This opinion is nonprecedential except as provided by
Minn. R. Civ. App. P. 136.01, subd. 1(c).

STATE OF MINNESOTA
IN COURT OF APPEALS
A20-1186

In re the Trust of the Elvira Ruth Halvorson Revocable Living Trust
Created under Agreement by Elvira Ruth Halvorson, Settlor, and
Elvira Ruth Halvorson, Trustee,
dated September 26, 2009, as amended.

Filed March 22, 2021
Affirmed
Florey, Judge

Stearns County District Court
File No. 73-CV-19-3822

John G. Westrick, Savage-Westrick, PLLP, Bloomington, Minnesota (for appellants)

Robert B. Bauer, Lauri A. Schmid, Dougherty, Molenda, Solfest, Hills & Bauer, PA, Apple
Valley, Minnesota (for respondent)

Considered and decided by Florey, Presiding Judge; Reilly, Judge; and Frisch,
Judge.
NONPRECEDENTIAL OPINION
FLOREY, Judge
In this appeal from summary judgment dismissing appellant -beneficiaries’ breach-
of-fiduciary-duty claims against respondent-trustee, appellants argue that the district court
erred by concluding that respondent did not breach his fiduciary duties by purchasing fixed
annuities instead of variable annuities, as the trust documents called for. Because the
trustee acted in good faith, reasonably interpreted the settlor’s intent, and did not abuse the
discretion invested in him as trustee, we affirm.

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FACTS
The Elvira Ruth Halvorson Revocable Living Trust (trust) was created in 2009 by
Elvira Halvorson (decedent), who died on April 15, 2016. Appellants Sharon McCarney,
Robert Halvorson, Chelsie Halvorson, Abigale Halvorson, and Shalie Halvorson, the
children and grandch ildren of decedent, were beneficiaries under the trust. Respondent
Ralph Haag, decedent’s brother, was appointed as sole trustee.
Under the terms of the trust, decedent directed respondent to use one -half of the
trust assets to “purchase equal variable annuities to be paid to [appellants] over their
lifetime.” Respondent interpreted decedent’s instruction to mean he “should purchase
annuities which provided steady payments to [appellants] , and which did not allow them
immediate access to the entire fund s.” When respondent attempted to buy variable
annuities, he discovered that such annuities could be cashed in for a lump sum. Respondent
considered variable annuities to be unstable and thought appellants could “lose [their]
money.” Respondent contacted several financial -advisor firms looking for variable
annuities that would s atisfy the trust specifications and, based on the advice he received,
concluded that only fixed annuities transferred after the surrender period would satisfy
decedent’s intent to purchase annuities that would be paid out over an extended period of
time. Respondent purchased fixed -term annuities and held them through the surrender
period. When respondent tried to transfer the annuities to appellants, they refused to accept
the transfer, fearing it would jeopardize their objections to the purchase of fixed annuities.
In May 2019, respondent petitioned for approval of the final account, termination
of the trust, and discharge of the trustee. Appellants objected to the petition and then sued

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respondent, alleging breach of fiduciary duty. Both respondent and appellants moved for
summary judgment.
Appellants submitted a report from an expert, who explained the various types of
annuities (variable, immediate variable, and fixed). The expert opined that respondent had
breached his fiduciary duty to appellants by purchasing fixed annuities rather than variable
annuities, as directed in the trust. He did not explain whether variable annuities could be
cashed out, but did state that “fixed annuities are used to provide a guaranteed stream of
income over a particular time period” and that “[a]nother popular feature of a fixed annuity
is that these investment vehicles are not subject to market risk or fluctuation.”
The district court granted summary judgment in favor of respondent, concluding as
a matter of law that he had not breached his fiduciary duty as trustee, and denied appellants’
motion for summary judgment. This appeal followed.
DECISION
A court “shall grant summary judgment if the movant shows that there is no genuine
issue as to any material fact and the movant is entitled to judgment as a matter of law.”
Minn. R. Civ. P. 56.01. We conduct a de novo review, viewing facts in the light most
favorable to the nonmoving party. Kelly v. Kraemer Const., Inc. , 896 N.W.2d 504, 508
(Minn. 2017). “A genuine issue of material fact arises when there is sufficient evidence
regarding an essential element to permit reasonable persons to draw different conclusions.”
Id. (quotation omitted). The essential facts here are undisputed: decedent specified
purchase of variable annuities but also indicated that the annuities should provide payments
over appellants’ li fetimes; respondent purchased fixed annuities because they would

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provide lifetime income to appellants; appellants’ expert explained the difference between
the types of annuities and opined that respondent violated the trust terms by failing to
purchase variable annuities, but stated that fixed annuities provided more stable income;
and appellants’ expert did not state whether appellants could cash out variable annuities.
At issue is whether respondent was entitled to judgment as a matter of law.
To maintain an action for breach of fiduciary duty, a plaintiff must prove four
elements: (1) duty; (2) breach; (3) causation; and (4) damages. Lund ex rel. Revocable Tr.
of Kim A. Lund v. Lund , 924 N.W.2d 274, 284 (Minn. App. 2019), review denied (Minn.
Mar. 27, 2019). Failure to establish one of these elements defeats a claim of breach of
fiduciary duty. Id. A trustee owes a fiduciary duty to the beneficiary of a trust. Thomas
B. Olson & Assoc s., P.A. v. Leffert, Jay & Polglaze, P.A. , 756 N.W.2d 907, 914 (Minn.
App. 2008), review denied (Minn. Jan. 20, 2009). Failure to administer a trust in
accordance with the settlor’s intent is a breach of fiduciary duty. Lund, 924 N.W.2d at 284.
Appellants argue that respondent breached his fiduciary duty by failing to carry out
decedent’s direction to purchase variable annuities.
We conduct a de novo review in interpreting a trust’s language. In re Trusteeship
of Williams, 591 N.W.2d 743, 746 (Minn. App. 1999). In trust matters, a court’s role is to
ensure that the settlor’s intent is fulfilled. Id. at 747. Intent is determined by reviewing the
trust instrument and considering any reasonable inferences that can be drawn from the
document. Id. A court determines a settlor’s “dominant intention” by considering the trust
agreement as a whole; if the trust agreement is not ambiguous, the court confines itself to
the agreement’s language and does not consider extrinsic evidence. In re G.B. Van Dusen

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Marital Trust, 834 N.W.2d 514, 520 (Minn. App. 2013), review denied (Minn. Jun. 26,
2013). The parties do not argue that the trust language is ambiguous but differ on what
they perceive decedent’s dominant intention to be.
“If a trustee acts in good faith, from proper motives, and within the bounds of
reasonable judgment in distributing trust funds,” a court will generally not interfere in the
trustee’s exercise of discretion, unless the trustee’s actions violate the settlor’s intent or the
trust’s purpose. Id. at 523 -24 (quotation omitted). This court has discussed factors to
consider in determining if a trustee has abused his or her discretion, including (1) the extent
of the trustee’s discretion under the trust terms; (2) the purpose of the trust; (3) the nature
or extent of power vested in the trustee; (4) the existence of a standard to judge the
reasonableness of the trustee’s actions; (5) the trustee’s motives; and (6) any conflicts of
interest between the trustee and the trust beneficiaries. In re Trusts A & B of Divine , 672
N.w.2d 912, 919-20 (Minn. App. 2004).
Respondent had broad discretion under the trust . Although decedent designated
variable annuities, the choice of annuities was left to respondent. By the language of the
trust, decedent intended that appellants receive a lifetime stream of income rather than a
lump sum. Respondent’s powers under the trust were similarly broad. Respondent
consulted a variety of experts before settling on the fixed annuities. Appellants do not
allege that respondent acted in bad faith or from an improper motive, or that there was a
conflict of interest.
Respondent provided an affidavit documenting his search for variable annuities that
would guarantee a lifetime stream of income and was advised that such a product was not

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available. Respondent chose to focus on what he discerned as decedent’s intent: a lifetime
stream of i ncome that could not be immediately liquidated as a lump sum. Appellants’
expert thoroughly explained the differences between the various types of annuities, but he
did not address the question of liquidation or potential for volatility of variable annuities,
which would have frustrated decedent’s intent. Appellants have not identified a genuine
issue of material fact that negates respondent’s exercise of reasonable discretion in accord
with decedent’s intent of providing a lifetime stream of income.
Because respondent did not abuse his discretion in the exercise of his duties as
trustee, the district court did not err by granting summary judgment in favor of respondent
on the issue of breach of fiduciary duty.1
Affirmed.

1 Appellants acknowledged at oral argument before this court that their challenge to the
final accounting was tied to resolution of the breach -of-fiduciary-duty question, and we
therefore decline to address this issue.