What about the Uniform Trust Code?
Interestingly, although the court in Kelly determined that a trust agreement isn't subject to Virginia's Uniform Arbitration Act because it isn't a contract, the court also noted that Virginia's Uniform Trust Code expressly grants trustees the power to resolving disputes involving the interpretation or administration of a trust by arbitration. In this case, however, the arbitration language used in the trust agreement at issue, which required arbitration of "disputes arising hereunder," is construed narrowly. According to the court, such language only requires arbitration of disputes involving the interpretation or enforcement of an agreement. The nephews claims sought neither. So, even if an arbitration clause in a trust agreement could be enforced generally, it would not be enforced in this particular case.
What if the arbitration clause used in the trust agreement was broader? Would the court have compelled arbitration, despite its ruling that a trust agreement isn't a contract subject to the Uniform Arbitration Act in the first place? The court doesn't really make that clear. It also doesn't really explain the import of the language in the Uniform Trust Code expressly contemplating the arbitration of trust disputes. Those are issues for another day. Given the large number of estate and trust litigation cases the Supreme Court of Virginia has taken recently, perhaps we will get some answers from the Commonwealth's highest court sooner than later.
Disputes involving trusts and estates are complex.
If the Kelly case makes one thing clear, it's this: Disputes involving trusts and estates often involve complex, nuanced issues. If you are involved in a dispute invovling an estate or trust, you will want to hire an attorney with experience handling such complex disputes. Don't wait. Contact us today.