In the Matter of the Trust Agreement of Genevieve M. Rossow.

This opinion is nonprecedential except as provided by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
A23-0473

In the Matter of the Trust Agreement of Genevieve M. Rossow.

Filed November 6, 2023
Affirmed
Slieter, Judge

Washington County District Court
File No. 82-CV-21-4706

John M. Degnan, A. Christopher Brown, Taft Stettinius & Hollister LLP, Minneapolis,
Minnesota (for appellant LeRoy J. Rossow Jr.)

Chelsea McLean, Dorsey & Whitney LLP, Minneapolis, Minnesota (for respondent Craig
L. Rossow)

Peter J. Gleekel, Alex Baker Kroeger, Samuel H.J. Schultz, Larson King, LLP, St. Paul,
Minnesota (for respondent James D. Rossow)

Considered and decided by Gaïtas, Presiding Judge; Slieter, Judge; and Halbrooks,
Judge.∗
NONPRECEDENTIAL OPINION
SLIETER, Judge
On appeal from the denial of his petition to remove his sons as trustees and appoint
an independent trustee , appellant challenges the district court’s determinations that his
authority to remove a trustee is subject to a fiduciary standard, that the trust document does

∗ Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to
Minn. Const. art. VI, § 10.
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not authorize him to appoint the independent trustee, and its decision to award respondents
attorney fees due to appellant’s bad faith. Because appellant’s authority to remove a trustee
is subject to a fiduciary standard and the tr ust document provides appellant with no
authority to appoint the independent trustee, and because the district court acted within its
discretion in awarding attorney fees, we affirm.
FACTS
Genevieve (Geni) Rossow established a trust in 2008, naming herself and her
husband, appellant LeRoy Rossow, as trustees. Upon Geni’s death, the trust names the
sons of Geni and LeRoy, respondents Craig Rossow and James Rossow, as successor
trustees to Geni.1
The trust requires that, after Geni’s death, there “always be one and only one
independent trustee.” The trust directs Craig and James to appoint the independent trustee,
and if no “independent trustee is appointed within sixty (60) days of [Geni’s] death, then
[Geni] appoint[s] BNC Bank of Minneapolis, Minnesota as the independent trustee.” Geni
died in August 2014.
In 2018, Craig and James commenced legal action against LeRoy relating to their
concerns over his administration of the trust. As part of settlement and dismissal of the
litigation, the parties agreed to contact BNC Bank to serve as an independent trustee, and
“[i]f BNC Bank is unwilling to serve, [parties] shall cooperate in good faith in finding a
suitable replacement independent trustee per the terms of the [t]rust.”

1 We refer to the parties by first name for clarity.
3
BNC Bank declined to serve as independent trustee. Craig and James then contacted
First State Bank and Trust of Bayport, which declined to serve because of animosity in the
family. Craig and James next contacted Wells Fargo to serve as the independent trustee
but LeRoy “wasn’t interested in discussing Wells Fargo as an independent trustee.”
Sometime before November 2021, and without communicating with Craig or James,
LeRoy contacted First Trust Company about serving as the independent trustee.
In November 2021, LeRoy petitioned the district court to remove Craig and James
as trustees and appoint First Trust as independent trustee. The district court held an
evidentiary hearing on LeRoy’s petition in July 2022. During the hearing, LeRoy testified
that he informed First Trust that he believed that he was entitled to all trust income, and
that he believed that First Trust shared in his understanding. LeRoy also acknowledged
that the trust document granted Craig and James sole authority to appoint the independent
trustee, which motivated him to seek their removal as trustees.
The district court denied LeRoy’s petition in September 2022, concluding that
LeRoy could not remove Craig and James as trustees because he was acting in bad faith,
and that he lacked the authority to appoint an independent trustee. LeRoy appeals.
DECISION
I. The district court properly determined that LeRoy’s authority to remove a
trustee is subject to a fiduciary standard and that he has no authority to
appoint an independent trustee.

A court’s purpose in interpreting a trust agreement is to “ascertain and give effect
to the grantor’s intent.” In re Stisser Grantor Tr., 818 N.W.2d 495, 502 (Minn. 2012), rev.
denied (Minn. June 26, 2013). A court should seek out the grantor’s intent by construing
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the trust agreement in its entirety. Id. If the trust agreement is unambiguous, a court should
look to the language of the agreement to discern the grantor’s intent without considering
extrinsic evidence. Id. This court applies a de novo standard of review to a district court’s
interpretation of a trust agreement. Id.
LeRoy’s Removal Authority is Subject to a Fiduciary Standard
LeRoy argues that his removal power is not subject to a fiduciary standard. He
claims that because the trust states that “[m]y spouse shall have power to remove any
trustee,” without referring to LeRoy as a trustee, his removal power is not subject to a
fiduciary duty. We are not persuaded.
Minnesota law imposes several fiduciary duties on trustees.
2 See e.g. , Minn. Stat.
§§ 501C.0801 (duty to administer in good faith), .0802 (duty of loyalty), .0803 (duty to
administer impartially) (2022). And caselaw highlights the importance of trustees
honoring their fiduciary duties. See e.g., In re Lee’s Est., 9 N.W.2d 245, 250 (Minn. 1943)
(“[t]he fiduciary character of [the trustee’s] position precludes him from taking any
advantage of his influence as trustee” (citation omitted)); Smith v. Tolversen, 252 N.W.2d
423, 425 (Minn. 1934) (noting a trustee’s “primary duty [is] not to allow his interest as an
individual even the opportunity of conflict with his interest as trustee”).
LeRoy cites no law, and we are aware of none, releasing a trustee from this fiduciary
standard simply because a trust provision refers to the trustee according to his relationship

2 Parties do not dispute the applicability of chapter 501C to this trust. See Minn. Stat.
§ 501C.1304(a)(1) (2022) (providing that “sections 501C.0101 to 501C.1208 apply to all
trusts created before, on, or after January 1, 2016”).
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to the settlor. See Minn. Stat. §§ 501C.0801-.0817 (outlining duties and powers of trustees)
(2022). Instead, caselaw makes clear that “[a] trustee is not permitted to disregard fiduciary
duties . . . even if a trust document gives the trustee broad authority.” In re Tr. of
Schwagerl, 965 N.W.2d 772, 783 (Minn. 2021). Indeed, “[a]lthough a power is conferred
upon the trustee, he cannot properly exercise the power if it constitutes a violation of any
of his duties to the beneficiary.” Id. (quotation omitted). Thus, the district court properly
determined that LeRoy’s removal authority is subject to the fiduciary duties outlined in
statute.
3
LeRoy Lacks Authority to Appoint the Independent Trustee
LeRoy claims that the district court erred by denying his petition to appoint First
Trust as independent trustee. According to the trust, the independent trustee may be
appointed by Craig and James, or by court appointment. LeRoy has no authority pursuant
to the terms of the trust to select or appoint the independent trustee. See Stisser, 818
N.W.2d at 502 (“When the trust agreement is unambiguous, we will ascertain the grantor’s
intent from the language of the agreement, without resort to extrinsic evidence.”). Because
LeRoy has no authority to appoint the independent trustee, the district court did not err by
denying his petition to appoint First Trust to serve as independent trustee.
II. The district court acted within its discretion by awarding attorney fees.

“An award of fiduciary compensation or attorney fees rests largely within the
district court’s discretion.” Id. at 507. For a trustee to be held personally liable for

3 LeRoy does not challenge the district court’s findings, which formed its basis to deny his
petition, that he “committed multiple breaches of fiduciary duty.”
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another’s fees and costs, the district court must make a finding of mismanagement or bad
faith. Ariola v. City of Stillwater, 889 N.W.2d 340, 361 (Minn. App. 2017).
LeRoy posits that he had a reasonable basis for the action, stating that the trust
unambiguously allows him to remove trustees. As we have already explained, the district
court correctly concluded that he may not remove trustees absent adherence to the fiduciary
standard, see supra part I.
The district court awarded attorney fees against LeRoy after finding he acted in bad
faith pursuant to Minn. Stat. § 549.14 (2022) (providing recovery of attorney fees for
mismanagement or bad faith in an action). The district court found “that LeRoy engaged
in bad faith in obstructing the appointment of an independent trustee” by “attempting to
remove Craig and James . . . as trustees to replace them with a hand- selected independent
trustee when he had no power to do so under the [t]rust.” The record supports this
determination. LeRoy refused to speak with potential independent trustees proposed by
Craig and James, excluded Craig and James from conversations with First Trust, and then
sought to remove Craig and James as trustees to unilaterally select an independent trustee
though the trust grants him no such authority. Thus, the district court acted within its
discretion in awarding attorney fees.
4
Affirmed.

4 LeRoy also argues that the terms of the October 2018 stipulation, which ended the
previous litigation, impermissibly modifies his rights under the trust. Because we
determine that LeRoy’s trustee-removal authority is subject to a fiduciary standard, and
because he does not contest the district court’s findings that he breached his fiduciary
duties, we nee d not determine whether the district court erred by determining that the
October 2018 order temporarily limits LeRoy’s removal authority.