In 1942, the predecessor to the Church of Jesus Christ of Latter-Day Saints formed the United Effort Plan Trust (UEP Trust) for charitable and philanthropic purposes, but conditioned membership in the UEP Trust on consecration of real and mixed property to the trust. Consecration was an act of faith by which members deeded their property to the UEP Trust to be managed by church leaders who were also trustees.
The UEP Trust was amended in 1998 to qualify as a charitable trust by benefitting “those that consecrate their lives to the … establishment of the Kingdom of God on Earth under the direction of the presidents of the church,” rather than specifically to the trust’s founders. After sexual abuse and fraud scandals involving the church’s president and trustee of the UEP Trust, the court appointed a special fiduciary for the UEP Trust. The special fiduciary filed a memorandum with the court recommending that the UEP Trust be reformed.
The district court concluded that the UEP Trust should be reformed so that the special fiduciary could administer the UEP Trust to meet the needs of the beneficiaries according to neutral nonreligious principles. The district court also found that the trustees had breached their fiduciary duties of loyalty and prudent trust administration and that several of the UEP Trust provisions were fundamentally flawed and unworkable justifying application of the doctrine of cy pres to reform the trust.
The district court reformed the UEP Trust to: (1) allow the trust property to be used only in furtherance of legitimate trust purposes as identified by the court; (2) allow the FLDS leaders to offer their nonbinding input, but granting the board of trustees the ultimate authority to determine who would be allowed to live on the trust property and to asses the trust property residents’ wants and needs; (3) limit the board’s powers to order relocation or property sharing among trust property residents to situations where the relation arrangement was necessary for legitimate UEP Trust administrative reasons; (4) delete the trust’s requirement that the occupants of the trust land live in accordance with church doctrine; and (5) removing from the FLDS Church president several powers under the UED Trust.
The district court retained jurisdiction over the UEP Trust and instituted a process that allowed the UEP Trust participants to petition to have the houses they lived in distributed to them.
In 2009, the FLDS Association petitioned the Utah Supreme Court for an extraordinary writ, alleging that the district court wanted to transform FLDS culture, liberate people it felt belonged to a dangerous cult, and suppress the FLDS Church’s role as the spiritual and economic center of the community.
The FLDS Association asked the Supreme Court to: (1) find that the district court’s actions violated the FLDS Church members’ First Amendment rights and their rights under Utah’s constitution; (2) declare that certain sections of Utah’s Uniform Trust Code were unconstitutional as applied to the FLDS Association; (3) enjoin the district court from taking further action in the underlying UEP Trust litigation; (4) declare the district court’s reformation of the UEP Trust unconstitutional; (5) terminate the reformed trust; (6) overturn the district court’s authorization to sell certain trust property deemed sacred by the FLDS Association; (7) terminate the appointment of the special fiduciary; and (8) provide other appropriate relief.
The Utah Attorney General, the Arizona Attorney General, and the UEP Trust, through the special fiduciary, opposed the petition alleging that the FLDS Association lacked standing, that other plain remedies existed, and that laches barred the FLDS Association’s claims.
On review, the Utah Supreme Court found that: (1) because the FLDS Association had waited nearly three years from the date of the trust modification and other parties relied on the modification, the FLDS Association claims were barred by the equitable doctrine of laches; and (2) the one claim not barred by laches (a claim that the court would disfavor current and practicing FLDS members in the trust administration) was not ripe for adjudication.