Trust ADR Provision Cannot Compel Arbitration of Undue Influence Challenges

Trust Law Controversies

Trust ADR Provision Cannot Compel Arbitration of Undue Influence Challenges to Trust Validity

Prepared March 15, 2026

Court: Court of Appeals of Arizona, Division 1

Date: February 17, 2026

Citation: In the Matter of The James A. and Carol A. May Living Trust, No. 1 CA-CV 25-0392 PB, 2026 WL 444664 (Ariz. Ct. App. Feb. 17, 2026)

Summary of Relevant Facts

Carol and James May established a living trust in 2003. In 2009, they executed an amendment designating Shannon and Michael May as successor co-trustees and naming them and a third child, Erin, as beneficiaries. A fourth child, Stephen, was expressly excluded. The 2009 Amendment included an ADR provision authorizing appointment of a “Special Co-Trustee” to resolve disputes through mediation and binding arbitration. James died in 2017. In 2019, Carol executed a new amendment removing Michael, Shannon, and Erin as beneficiaries and naming the May Family Foundation—a donor-advised fund of Legacy Global Foundation, whose founder was attorney Richard E. Durfee—as the principal beneficiary. Carol died in 2021.

Procedural Background

Shannon and Michael, as successor co-trustees, appointed Jerome Elwell as Special Co-Trustee under the 2009 ADR provision to resolve the dispute over the 2019 Amendment’s enforceability. Elwell directed parties to submit memoranda on the amendment’s validity. Legacy filed a petition seeking a declaration that A.R.S. § 14-10205 does not permit trustors to require beneficiaries to submit validity challenges to binding ADR. Shannon moved to dismiss, arguing the Special Co-Trustee had authority. The superior court sided with Shannon, characterizing the claim as a “distribution” challenge rather than a validity challenge. Legacy appealed.

Main Controversies

The central controversy was whether Arizona’s trust code (A.R.S. § 14-10205), which authorizes mandatory ADR provisions for disputes involving trust “administration or distribution,” extends to challenges attacking the validity of a trust amendment on grounds of undue influence.

Position of the Parties

Legacy argued that validity challenges—such as allegations that a trust amendment was procured through undue influence—are fundamentally different from disputes about administration or distribution and cannot be forced into private ADR. Shannon argued that Arizona’s strong public policy favoring ADR required an expansive interpretation, and that any doubt about arbitrability should be resolved in favor of ADR.

Holding or Decision

The Court of Appeals vacated the superior court’s dismissal and remanded. It held that A.R.S. § 14-10205 does not empower trustors to adopt mandatory ADR provisions that deny beneficiaries their right to seek judicial resolution of claims challenging the validity of trust instruments on the basis of undue influence. A challenge to the validity of a trust amendment is not a dispute over “administration or distribution.”

Reasons for the Decision

The court started with the plain meaning of the statute. Consulting Black’s Law Dictionary, it found that “administration” and “distribution” both presuppose the validity of the underlying trust documents. Neither term encompasses the threshold question of whether the trust instrument itself is valid. The court found further support in A.R.S. § 14-10107(B), which expressly distinguishes between “validity” and “administration” by assigning jurisdiction over each to different courts based on different criteria. The court rejected the presumption favoring arbitration, reasoning that this principle applies only when contracting parties who agreed to an arbitration clause dispute its scope—here, the ADR provision was imposed by the trustors, not agreed to by the disputing parties. The court cited persuasive authority from Gibbons v. Anderson (Arkansas), holding that arbitration provisions cannot compel arbitration to determine the validity of the trust itself. The court also drew an analogy to contract law, where claims that a contract was procured through undue influence are not within the scope of mandatory arbitration provisions.