§ 15.4 Procedural Issues

• Library: Administering Trusts in Oregon (OSBar) (2018 Ed.)

§ 15.4 PROCEDURAL ISSUES

§ 15.4-1 Jurisdiction

In general, jurisdiction for trust litigation was created in the circuit court under original Article VII, section 9, of the Oregon Constitution: "All judicial power, authority, and jurisdiction not vested by this Constitution, or by laws consistent therewith, exclusively in some other Court shall belong to the Circuit Courts, and they shall have appellate jurisdiction, and supervisory control over the County Courts, and all other inferior Courts, Officers, and tribunals." Article VII (Amended), section 2, gives this provision the status of a statute.

Jurisdiction is also vested in the circuit court under ORS 130.060 and ORS chapter 28 (dealing with declaratory judgments).

ORCP 4 addresses personal jurisdiction; ORCP 5 addresses in rem jurisdiction. Although these rules appear specifically to create jurisdiction involving trust actions, the "sufficient affiliation" or "minimum contacts" issues raised in Hanson v. Denckla, 357 US 235, 78 S Ct 1228, 2 L Ed 2d 1283 (1958), may still lurk in the area of jurisdiction for trust litigation. It appears that if the trustee is an indispensable party, jurisdiction lies whenever the trustee lives in the state or, if a nonresident, has performed sufficient acts in the state. Jurisdiction over an inter vivos trust usually remains with the court of the state in which the property is located, regardless of the place of the settlor's death. See generally G. Van Ingen, Annotation, Jurisdiction of Suit Involving Trust as Affected by Location of Res, Residence of Parties to Trust, Service, and Appearance, 15 ALR2d 610 (1951) (updated periodically); 1 Oregon Civil Pleading and Practice ch 2 (OSB Legal Pubs 2012).

Personal jurisdiction may not be exercised over a nonresident trustee merely because the trustee has agreed to administer a foreign trust with knowledge that some of the beneficiaries reside in Oregon. Dreher v. Smithson, 162 Or App 645, 650-51, 986 P2d 721 (1999), rev den, 329 Or 589 (2000). Although these facts satisfy the first prong of Oregon's long-arm statute under ORCP 4 E(3) (i.e., jurisdiction based on a defendant's promise to deliver a "thing of value" in Oregon), it does not satisfy the constitutional requirements under the federal Due Process Clause. Dreher, 162 Or App at 652-53. Furthermore, although the due-process requirements are automatically met in an action for "injury to person or property," ORCP 4 D, an action to remove a nonresident trustee is not such an action. Dreher, 162 Or App at 653.

A person who accepts delegation of a trustee's function under a trust submits to jurisdiction in Oregon if the trust has its principal place of business in Oregon. ORS 130.055(1). Likewise, the beneficiaries of a trust having its principal place of administration in Oregon are subject to the jurisdiction of the courts regarding any matter involving the beneficiaries' interests in the trust, and they submit personally to the jurisdiction of the Oregon courts by accepting distributions from the trust. ORS 130.055(2).

§ 15.4-2 Venue

Proper venue for any trust litigation is the "county in which the trust's principal place of administration is or will be located." ORS 130.065(1). In turn, the principal place of administration will generally be the county in which the trustee is located. See ORS 130.022 & cmt, printed in Valerie J. Vollmar, The Oregon Uniform Trust Code and Comments, 42 Willamette L Rev 187, 221-22 (2006).

NOTE: In the case of will-substitute revocable living trusts, the principal place of administration during the settlor's life remains the principal place of administration after death, even if the successor trustee lives outside that county or even out of state, unless the successor trustee changes the principal place of

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