Justices reverse, rule for sister in siblings’ ‘restraint on marriage’ trust dispute

Indiana Supreme Court justices reversed Friday in a dispute between two siblings over a provision in their late mother’s trust regarding her son, holding that it was not an unlawful restraint on marriage.

Issues in the case began when siblings Roger Rotert and Connie Stiles went to court over the terms of their mother’s trust, which held that in the event Rotert was married at the time his mother died, his share of her property would be given to Stiles via a second trust.

Rotert was married when his mother died, and the Jackson Circuit Court denied his motion for summary judgment claiming those terms were void as a restraint against marriage.

The Indiana Court of Appeals split in reversing judgment for Stiles, concluding that because the marriage provision never had any legal existence, the provision could not be saved by an agreement or waiver of the parties.

But the Supreme Court reversed on Friday, rejecting Rotert’s arguments that the trial court’s summary judgment order both violated his due process rights and was wrong as a matter of law because the challenged provision is void on public-policy grounds.

It first concluded that the due-process claim failed because Rotert had reasonable notice and a meaningful opportunity to respond to Stiles’ motion, yet failed to do so.

The justices also agreed that Stiles is entitled to relief, but on a different ground than her allegation that the provision is a permissible “limitation” on Rotert’s interest, not an impermissible “condition.”

“We hold that the statutory prohibition of restraints against marriage applies only to dispositions to a spouse by will and not to dispositions by trust. We thus affirm the trial court without deciding whether this provision is a condition or a limitation,” it wrote.

The justices further concluded that the statutory rule prohibiting restraints against marriage does not apply because it governs only testamentary devises to a spouse in a will.

“Here, the challenged disposition is from parent to child in a revocable trust,” it wrote, concluding that the statutory prohibition under the probate code does not apply. Neither does the Indiana trust code prohibit the challenged provision, it added.

“Here, Rotert points to nothing in the trust code that ‘clearly prohibit[s] or restrict[s]’ the challenged provision, and we know of none. Given this section’s mandate to honor (the mother’s) intent, we decline to invalidate the challenged provision or to restrict what the legislature does not forbid,” it wrote.

The justices disapproved of the contrary holding in In re Estate of Robertson, 859 N.E.2d 772 (Ind. Ct. App. 2007), declining to adopt the appellate court’s statement that the prohibition of restraints against marriage was a “well-settled general rule of law.”

Lastly, the high court in Roger D. Rotert v. Connie S. Stiles, 21S-TR-00452, parted ways with Justice Christopher Goff’s concurrence on his conclusion that restraints against marriage violate public policy.

“Yet it points to nothing in the trust code providing that restraints against marriage in trust provisions violate public policy,” the justices wrote of the concurrence. “Instead, it relies on the Restatement (Third) of Property (Wills & Don. Trans.) § 10.1 cmt. c (2003), which is not the law in Indiana and cannot trump a duly enacted statute.”

In his concurrence, Goff wrote that he would conclude that the prohibition against restraints on marriage should apply to testamentary trusts, not just to wills.

Based on that conclusion, the concurring justice would affirm the trial court by holding that, because Rotert’s interests in the estate vested “at the time of” the settlor’s death, the terms of the trust amounted to permissible conditions of acquisition rather than impermissible conditions of retention.