Washington State has a comprehensive statutory system for resolving trust and estate disputes, known as the Trust and Estate Dispute Resolution Act, (“TEDRA”) at Chapter 11.96A RCW. TEDRA contains detailed procedures for litigating and settling trust and estate disputes.
Whats is a Trust and Estate Dispute Resolution Agreement under Washington State Law?
A TEDRA Agreement is an agreement made under the Trust and Estate Dispute Resolution Act. RCW 11.96A.210 explains the purpose of a TEDRA Agreement:
The purpose of RCW 11.96A.220 through 11.96A.250 is to provide a binding nonjudicial procedure to resolve matters through written agreements among the parties interested in the estate or trust. The procedure is supplemental to, and may not derogate from, any other proceeding or provision authorized by statute or the common law.
A TEDRA Agreement will resolve conclusively the trust or estate matter covered by the agreement. RCW 11.96A.220 provides, in part:
If all parties agree to a resolution of any such matter, then the agreement shall be evidenced by a written agreement signed by all parties. Subject to the provisions of RCW 11.96A.240, the written agreement shall be binding and conclusive on all persons interested in the estate or trust. The agreement shall identify the subject matter of the dispute and the parties. If the agreement or a memorandum of the agreement is to be filed with the court under RCW 11.96A.230, the agreement may, but need not, include provisions specifically addressing jurisdiction, governing law, the waiver of notice of the filing as provided in RCW 11.96A.230, and the discharge of any special representative who has acted with respect to the agreement.
If a party who virtually represents another under RCW 11.96A.120 signs the agreement, then the party’s signature constitutes the signature of all persons whom the party virtually represents, and all the virtually represented persons shall be bound by the agreement.
The definition section of TEDRA defines a “matter” for purposes of TEDRA, at RCW 11.96A.030(2). Accordingly, the following matters may be resolved through a TEDRA Agreement:
(a) The determination of any class of creditors, devisees, legatees, heirs, next of kin, or other persons interested in an estate, trust, nonprobate asset, or with respect to any other asset or property interest passing at death;
(b) The direction of a personal representative or trustee to do or to abstain from doing any act in a fiduciary capacity;
(c) The determination of any question arising in the administration of an estate or trust, or with respect to any nonprobate asset, or with respect to any other asset or property interest passing at death, that may include, without limitation, questions relating to: (i) The construction of wills, trusts, community property agreements, and other writings; (ii) a change of personal representative or trustee; (iii) a change of the situs of a trust; (iv) an accounting from a personal representative or trustee; (v) the determination of fees for a personal representative or trustee; or (vi) the powers and duties of a statutory trust advisor or directed trustee of a directed trust under chapter 11.98A RCW;
(d) The grant to a personal representative or trustee of any necessary or desirable power not otherwise granted in the governing instrument or given by law;
(e) An action or proceeding under chapter 11.84 RCW;
(f) The amendment, reformation, or conformation of a will or a trust instrument to comply with statutes and regulations of the United States internal revenue service in order to achieve qualification for deductions, elections, and other tax requirements, including the qualification of any gift thereunder for the benefit of a surviving spouse who is not a citizen of the United States for the estate tax marital deduction permitted by federal law, including the addition of mandatory governing instrument requirements for a qualified domestic trust under section 2056A of the internal revenue code, the qualification of any gift thereunder as a qualified conservation easement as permitted by federal law, or the qualification of any gift for the charitable estate tax deduction permitted by federal law, including the addition of mandatory governing instrument requirements for a charitable remainder trust;
(g) With respect to any nonprobate asset, or with respect to any other asset or property interest passing at death, including joint tenancy property, property subject to a community property agreement, or assets subject to a pay on death or transfer on death designation:
(i) The ascertaining of any class of creditors or others for purposes of chapter 11.18 or 11.42 RCW;
(ii) The ordering of a qualified person, the notice agent, or resident agent, as those terms are defined in chapter 11.42 RCW, or any combination of them, to do or abstain from doing any particular act with respect to a nonprobate asset;
(iii) The ordering of a custodian of any of the decedent’s records relating to a nonprobate asset to do or abstain from doing any particular act with respect to those records;
(iv) The determination of any question arising in the administration under chapter 11.18 or 11.42 RCW of a nonprobate asset;
(v) The determination of any questions relating to the abatement, rights of creditors, or other matter relating to the administration, settlement, or final disposition of a nonprobate asset under this title;
(vi) The resolution of any matter referencing this chapter, including a determination of any questions relating to the ownership or distribution of an individual retirement account on the death of the spouse of the account holder as contemplated by RCW 6.15.020(6);
(vii) The resolution of any other matter that could affect the nonprobate asset; and
(h) The reformation of a will or trust to correct a mistake under RCW 11.96A.125.
Accordingly, just about every issue concerning an estate, trust, or nonprobate asset can be the subject of a TEDRA Agreement.
What Are the Requirements of a TEDRA Agreement?
A TEDRA Agreement needs to be in writing and signed by all persons interested in the estate or trust. Interested persons is defined as follows, at RCW 11.96A.030(6):
“Persons interested in the estate or trust” means the trustor, if living, all persons beneficially interested in the estate or trust, persons holding powers over the trust or estate assets, the attorney general in the case of any charitable trust where the attorney general would be a necessary party to judicial proceedings concerning the trust, and any personal representative or trustee of the estate or trust.
A TEDRA Agreement may, but is not required to be, filed with the court having jurisdiction over the estate or trust. RCW 11.96A.230 provides:
Entry of agreement with court—Effect.
(1) Any party, or a party’s legal representative, may file the written agreement or a memorandum summarizing the written agreement with the court having jurisdiction over the estate or trust. The agreement or a memorandum of its terms may be filed within thirty days of the agreement’s execution by all parties only with the written consent of the special representative. The agreement or a memorandum of its terms may be filed after a special representative has commenced a proceeding under RCW 11.96A.240 only after the court has determined that the special representative has adequately represented and protected the parties represented. Failure to complete any action authorized or required under this subsection does not cause the written agreement to be ineffective and the agreement is nonetheless binding and conclusive on all persons interested in the estate or trust.
(2) On filing the agreement or memorandum, the agreement will be deemed approved by the court and is equivalent to a final court order binding on all persons interested in the estate or trust.
Normally, a final Washington court order would be faster and easier to enforce than a trust and estate dispute resolution written agreement. Filing the TEDRA Agreement, however, makes the Agreement available for public inspection, which the parties may not want. If a special representative has been appointed, to protect the interests of minors, for example, the special representative would normally insist on filing the Agreement with the Court and having the Court exercise its oversight as explained in the statute.