Cumming v. Nipping

                                        780

Argued and submitted November 18, 2019, reversed and remanded April 21, 2021


                          Laurie CUMMING,
                          Plaintiff-Appellant,
                                    v.
                           Laurie NIPPING
                           and Kent Nipping,
                        Defendants-Respondents.
                       Lane County Circuit Court
                         161224954; A168015
                                    

    This case is on appeal for the second time. Plaintiff brought a claim against
defendants for unjust enrichment, asserting that plaintiff’s stepmother had
wrongfully transferred $300,000 in trust assets to defendants. After a bench
trial, the trial court denied plaintiff’s claim. In the first appeal, the Court of
Appeals concluded that the trial court had applied the wrong legal standard,
vacated the judgment, and remanded for further proceedings. Under the correct legal standard, to prevail on an unjust enrichment claim in circumstances
like these, the plaintiff must prove that (1) property or a property interest that
rightfully belongs to the plaintiff was taken or obtained by someone else under
circumstances that in some sense were wrongful or inequitable; (2) the person
who now possesses the property is not a bona fide purchaser for value and without
notice; and (3) the property upon which the plaintiff seeks to impose a constructive trust is the property that rightfully belongs to the plaintiff or is a product of
or substitute for it. On remand, on the same record, the trial court again denied
plaintiff’s claim. Held: The trial court erred in its application of the legal standard to this record.
    Reversed and remanded.



   Jay A. McAlpin, Judge.
   James R. Cartwright argued the cause and filed the
briefs for appellant.
   Brian J. Millington argued the cause for respondents.
Also on the brief were Julian W. Marrs and Thorp, Purdy,
Jewett, Urness & Wilkinson, P.C.
   Before Armstrong, Presiding Judge, and Tookey, Judge,
and Aoyagi, Judge.
    AOYAGI, J.
    Reversed and remanded.
    Tookey, J., dissenting.
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        AOYAGI, J.
         This case, which arises from a dispute regarding
trust property, is on appeal for the second time. Plaintiff
brought an action against defendants for unjust enrichment,
asserting, essentially, that the trustee wrongfully transferred $300,000 in trust assets to defendants. After a bench
trial, the trial court denied plaintiff’s claim. In the first
appeal, we vacated and remanded for further proceedings,
holding that the court had not correctly analyzed plaintiff’s
claim. Cumming v. Nipping, 

, 

(2017) (Cumming I). On remand, on the same record, the
court again denied plaintiff’s claim, and plaintiff again
appeals. For the following reasons, we reverse and remand.
               I. STANDARD OF REVIEW
         Unjust enrichment is an equitable doctrine. Wilson
v. Gutierrez, 

, 

 (2014). However, plaintiff does not request de novo review, nor do we
exercise our discretion to provide it. See ORS 19.415(3)(b)
(granting “sole discretion” to the Court of Appeals whether
to allow de novo review in equitable proceedings). We are
therefore bound by the trial court’s factual findings if they
are supported by any evidence in the record, Wilson, 

, and state the facts accordingly. We review the
trial court’s legal conclusions for errors of law. 

                         II. FACTS
         We summarize only the most pertinent facts, noting
that we have already recounted some of the facts in our first
opinion. See Cumming I, 

.
          During their marriage, plaintiff’s father and stepmother created a trust. When father died in 1999, the trust
split into two trusts, Trust A, a revocable trust known as the
survivor’s trust, and Trust B, an irrevocable trust known
as the tax credit trust. Stepmother had unlimited access to
both the income and the principal from Trust A. Her access
to Trust B was more limited. Under the trust instrument,
the trustee could use “as much of the net income” from Trust
B “as the trustee, in the trustee’s discretion, shall deem necessary for [stepmother’s] proper health, maintenance, support and education,” taking into consideration stepmother’s
782                                        Cumming v. Nipping

other income and resources as the trustee deems advisable.
Regarding the principal of Trust B, the trust instrument
provided:
       “If the trustee deems income payments to be insufficient,
   the trustee shall, from time to time, pay to or apply for the
   benefit of the surviving trustor, a sum out of the principal
   of Trust B as the trustee, in the trustee’s discretion, deems
   necessary for the trustor’s proper health, maintenance, support and education. Such payment may be made after Trust
   A has been exhausted, or before Trust A is exhausted.”
(Emphases added.)
        At all relevant times, the only asset in Trust B was
a condominium in California known as “Seagate,” where
father had resided with plaintiff’s mother and, later, stepmother. Under the terms of the trust, as a beneficiary of
Trust B, stepmother had the right to continue to live at
Seagate, rent-free, for so long as she desired. Further, the
trustee—who was stepmother herself during the time relevant to this appeal—could sell Seagate and buy a replacement home of comparable or lesser value, if stepmother
wished. The trustee also had discretion to encumber Seagate
with a mortgage “for any valid trust purpose.” Upon stepmother’s death, the assets in Trust B were to go to plaintiff
and plaintiff’s children, subject to any valid encumbrances.
         Stepmother resided at Seagate until 2008, when
she moved to Oregon to be closer to defendants. Defendant
Laurie Nipping is stepmother’s granddaughter, and defendant Kent Nipping is Laurie’s husband. Stepmother was
close to Laurie Nipping, who had moved to Oregon in 2005.
Upon arriving in Oregon, stepmother briefly lived with
defendants and then moved into an assisted living facility as she had planned. While stepmother was living in
Oregon, defendants managed her finances, helped her with
moves, and occasionally ran errands for her. Stepmother’s
living expenses were fully covered by her pension and
Social Security income. Additionally, stepmother received
$2,000 in monthly rental income from Seagate, effectively
as income payments from Trust B. According to defendant
Laurie Nipping, stepmother had over $100,000 in her personal accounts as of October 2010.
Cite as 

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         In 2010, defendants were looking to move closer
to Portland with their four children, and they raised with
stepmother the possibility of her moving as well and their
living together. Laurie Nipping wanted stepmother to live
with them for “however long she had left.” Defendants eventually found a farmhouse property in disrepair—the Kropf
property—that they thought would be perfect if they fixed
it up, because it was big enough for stepmother to have her
own area. At some point, however, they discovered that the
property did not qualify for conventional financing, due to
its condition and other circumstances, and had to be purchased for cash. Needing to act quickly to get ahead of
other buyers, defendants suggested that stepmother borrow
$300,000 against Seagate to purchase it. At the time, defendants were aware that Seagate was held in trust but did
not know the terms of the trust. Stepmother agreed, saying,
“Sure, honey. That’s fine.” Defendants, who handled stepmother’s finances, then handled the “details.” Stepmother
(presumably acting through defendants) took Seagate out of
the trust—transferring title from the trust to stepmother
personally—to obtain a mortgage on Seagate in stepmother’s
name. That enabled stepmother to obtain $300,000 in cash,
which was the approximate purchase price of the Kropf
property. Seagate was then put back into the trust, via
another change of title, but now encumbered by a $300,000
mortgage.

        Stepmother used the $300,000 to buy the Kropf property in October 2010, deeding a one-half interest to herself
personally and a one-half interest to defendants. Defendant
Laurie Nipping viewed the one-half interest that she and
her husband received as a “gift” from stepmother. As for
stepmother’s personal half-interest, stepmother’s will provided for defendants to inherit it upon stepmother’s death,
although there is no evidence that defendants were aware of
that provision of stepmother’s will. It should be noted that
stepmother was found to be mentally competent at all relevant times and not unduly influenced by defendants.

         Defendants proceeded to renovate the Kropf property, including setting up a bedroom, sitting room, and
bathroom for stepmother’s use. Defendants took $50,000
784                                      Cumming v. Nipping

out of stepmother’s personal accounts to pay for renovations. Defendants also spent “more than $50,000” of their
own money on renovations. Defendants lived in a trailer on
the property during the renovations, which they anticipated
would take about three months. The plan was for stepmother
to move in on February 1, 2011.
        In late December 2010, however, stepmother became
ill and was hospitalized. She was released from the hospital on December 25, 2010, into hospice care. Rather than
return to her assisted living facility, stepmother spent that
night at the Kropf house with defendants, passing away on
December 26, 2010. It was the only night she stayed at the
property.
         After stepmother’s death, defendants inherited stepmother’s personal one-half interest in the Kropf property,
under the terms of her will. Meanwhile, plaintiff obtained
title to Seagate. Defendant Laurie Nipping, the successor
trustee, was not involved in the transfer of Seagate’s title
to plaintiff; rather, there is evidence that plaintiff improperly effectuated the transfer of title on her own. Sometime
thereafter, plaintiff discovered the $300,000 mortgage on
Seagate, after it had gone unpaid for nearly a year, such
that Seagate was about to go into foreclosure. Plaintiff filed
this action, asserting, as relevant here, that defendants
had been unjustly enriched by stepmother’s violation of the
trust terms. For relief, plaintiff prayed that defendants be
required to pay off the promissory note and reimburse any
note payments made by plaintiff, or, alternatively, that the
Kropf property be recognized as subject to a constructive
trust.
         The matter was tried to the court, and, as described
in our first opinion, the trial court denied plaintiff’s unjust-enrichment claim. Cumming I, 

.
On appeal, we vacated the judgment and remanded for a
correct analysis of plaintiff’s claim under the legal standard articulated in Tupper v. Roan, 

, 

(2010). Cumming I, 

.
        On remand, the trial court undertook to apply the
Tupper standard, including making factual findings based
on the existing trial record. As discussed in more detail
Cite as 

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below, the trial court again denied plaintiff’s claim. Plaintiff
again appeals, assigning error to the dismissal of her claim.1
                       III. ANALYSIS
         As discussed in Cumming I, the Supreme Court
in Tupper “articulated three specific requirements that a
plaintiff must establish to prevail in asserting an unjust
enrichment claim where, as here, the plaintiff has alleged
that the defendant (a third party) acquired title to which the
plaintiff holds a superior right.” Cumming I, 

. Plaintiff must establish (1) “that property or a property
interest that rightfully belongs to her was taken or obtained
by someone else under circumstances that in some sense
were wrongful or inequitable”; (2) “that the person who now
possesses the property is not a bona fide purchaser for value
and without notice”; and (3) that the property upon which
the plaintiff seeks to impose a constructive trust is in fact,
by clear and convincing evidence, “the very property that
rightfully belongs to her, or is a product of or substitute for
that property.” 

. We address each requirement
in turn, to determine whether the trial court erred in dismissing plaintiff’s claim.
A. Wrongful or Inequitable Circumstances
         To prevail on her unjust-enrichment claim, plaintiff
first had to prove that defendants obtained a property interest that rightfully belonged to her “under circumstances that
in some sense were wrongful.” Cumming I, 

. Wrongfulness must be grounded in recognized legal
principles, rather than “abstract notions of morality.” 

. In this case, whether the circumstances were wrongful
comes down to whether, when stepmother took $300,000 in
assets out of the principal of Trust B, she was acting within
her discretion as trustee or, instead, was violating the terms
of the trust. See 

 (describing the trial court’s task
as being to “determine whether the trust allowed stepmother
    1
      In a second assignment of error, plaintiff challenges the trial court’s interpretation of the trust instrument, as relevant to its reasoning for dismissing
plaintiff’s claim. We address that issue as part of the first assignment of error.
See Cedartech, Inc. v. Strader, 

, 

 (2018) (“The
assignments are criticisms of the trial court’s reasons for its result but are not
truly rulings of the trial court of the sort that are required to be identified in an
assignment of error.” (Emphases in original.)).
786                                     Cumming v. Nipping

to encumber Seagate and, if so, under what terms,” and
whether stepmother’s “actions comported with those terms”).
         California law controls that determination, because
the trust provides that it is governed by California law.
Under California law, “the trustee has a duty to administer
the trust according to the trust instrument.” Cal Prob Code
§ 16000. “In construing a trust instrument, the intent of the
trustor prevails and it must be ascertained from the whole of
the trust instrument, not just separate parts of it.” Scharlin
v. Superior Court, 9 Cal App 4th 162, 168, 11 Cal Rptr 2d
448, 452 (1992). “Ordinary words must be given their normal, popular meaning and legal terms are presumed to be
used in their legal sense.” Id. “The trustee also must deal
impartially with all beneficiaries,” and, if “given discretionary power, the trustee must exercise his or her power reasonably.” Penny v. Wilson, 123 Cal App 4th 596, 603, 20 Cal
Rptr 3d 212, 216 (2004). “Even if a trustee is given ‘sole’ and
‘absolute’ discretion, he or she must act in accordance with
fiduciary principles and must not act in bad faith or in disregard of the purposes of the trust.” Id.
          Here, the trial court concluded that stepmother had
acted within her discretion as trustee when she borrowed
$300,000 against a trust asset, used it to buy the Kropf
property, and then deeded one-half ownership to herself
personally and one-half ownership to defendants. In particular, the court concluded that stepmother was allowed to
take those actions because the trust instrument gave her
discretion to use trust assets as necessary for her health,
education, maintenance, and support (HEMS), including encumbering trust assets. The court concluded that
stepmother’s purchase of the Kropf property was a “valid
exercise of that discretion,” and it opined that to conclude
otherwise would require second-guessing stepmother’s decision about how best to care for herself or would “illogically
restrict[ ]” the meaning of “health, maintenance or support.”
As for the connection between stepmother’s purchase of the
Kropf property and her health, maintenance, or support,
the trial court found that stepmother was acting according
to an implied agreement with defendants, by which defendants implicitly committed to “care for, support, and maintain [stepmother] in her remaining years” and to “provide
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companionship, security and consistency” for a potentially
extended period.
          We agree with plaintiff that the trial court’s
analysis misapplies the legal standard. Under the terms
of the trust, stepmother as trustee had broad discretion to
use the net income from Trust B assets—i.e., the Seagate
rental income—as she deemed necessary for her HEMS
needs. She had less discretion, however, to invade the principal. Only if stepmother deemed income payments “insufficient” to provide for her HEMS needs could she invade the
trust principal. On this record, there is no evidence that the
income payments were insufficient to provide for stepmother’s HEMS needs or, more importantly, that stepmother ever
deemed them so. The mere fact that stepmother agreed to
invade the principal to buy the Kropf house does not, in and
of itself, establish that the condition precedent for invading
the principal was met.
         It is undisputed that stepmother had sufficient
income to fully cover her living costs and bills, which she
used for that purpose. Of course, stepmother was free to
change her living arrangement, if she so wished. It does
not follow, however, that stepmother could simply withdraw
$300,000 from the Trust B principal to buy a second home
and deed it half to herself and half to someone else.
          The trust specifically provided that stepmother
could sell Seagate and buy a replacement home of comparable or lesser value, which replacement home would necessarily be a trust asset. Instead, stepmother transferred Seagate
out of the trust just long enough to get a mortgage in her
own name, and then used the resulting $300,000 to buy the
Kropf property, deeding a half-interest to herself personally
and a half-interest to defendants.2 That approach clearly
     2
       Because Seagate was owned by the trust, not stepmother, it presumably
had to be taken out of trust for stepmother to get a mortgage in her own name.
It does not follow that the only way to encumber Seagate was to take it out of
trust—something that no one argues but that the dissent assumes. See 310 Or
App at 807-08, 812 (Tookey, J., dissenting). If the terms of the trust had been
followed, the trustee presumably could have sold or encumbered Seagate while
leaving it in trust. The dissent’s assumption to the contrary is untethered to any
cited principle of trust law or real estate law, and we disagree that plaintiff had
the “burden” to foresee and disprove the dissent’s unexplained assumption. See
id. at 808 n 6 (Tookey, J., dissenting).
788                                     Cumming v. Nipping

was not what the trust contemplated in terms of acquisition
of a replacement home. Using trust assets to buy real property in stepmother’s own name was also inconsistent with a
trust provision that expressed an overriding intent to keep
Trust B assets from being included in stepmother’s estate
for federal estate tax purposes, including providing that,
regardless of any other trust provisions, stepmother was not
to take any action or have any power as trustee that would
lead to that result.
         Setting to the side the replacement-home issue,
there is no evidence that stepmother deemed it necessary
to providing for her HEMS needs that she buy real property and deed it to herself and defendants. While stepmother was living in an assisted-living facility in Oregon,
defendants told her that they wanted her to live with them
and be part of their family. Defendants became interested
in the Kropf property, which they thought would be perfect
because it was big enough to house defendants and their four
children while also giving stepmother her own area. When
defendants learned that it had to be a cash purchase, due to
the property’s condition, they suggested to stepmother that
she borrow $300,000 against Seagate. They knew Seagate
was in trust but did not know the terms, and they needed
to act fast to beat out other offers. Stepmother agreed, and
defendants handled the details. Thus, stepmother certainly
agreed to take $300,000 out of Trust B principal to buy
property where she eventually intended to live with defendants. However, there is no evidence that defendants’ offer
to live with stepmother was made contingent upon her giving them a 50-percent or 100-percent interest in the Kropf
property or otherwise paying them. To the contrary, the only
evidence is that defendants approached stepmother about
living together out of familial feeling and, when she subsequently deeded them a one-half interest in the Kropf property, they viewed it as a “gift.” And there is no evidence that
defendants were even aware that stepmother had provided
in her will for them to inherit stepmother’s one-half interest
in the property.
         Similarly, there is no evidence that, in deciding to
live together, defendants were agreeing to provide any type
of care or support to stepmother, beyond the love of family.
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Agreeing to live with an elderly person does not in and of
itself constitute an agreement to provide for the person’s
HEMS needs. When defendants talked to stepmother about
living together, she was receiving the lowest level of care
offered at the assisted-living facility, she had always paid for
her own HEMS needs, and she had significant assets to continue doing so. On this record, it is impermissibly speculative to infer an implied agreement by defendants to assume
responsibility for stepmother’s HEMS needs in exchange
for $150,000 or $300,000 of real property. Defendant
Laurie Nipping testified that what she expected from living together was simply being able to “have coffee together,
have a glass of wine together,” and “just do[ ] life together,”
instead of “coming and going and having short little visits.”
The issue here is not whether defendants should be financially rewarded for their kind treatment of an older relative, so as to incentivize kind treatment of older relatives.
The issue is whether the trustee (stepmother) complied with
the terms of the trust instrument created by stepmother
and plaintiff’s father, when she encumbered Seagate in the
manner that she did. See Cumming I, 

.
         We conclude that the trustee (stepmother) did not
comply with the terms of the trust. The evidence does not
allow a reasonable inference that the condition precedent for
invading Trust B principal had been met—that is, that the
trustee had deemed the Trust B income payments “insufficient” to meet stepmother’s HEMS needs and deemed it “necessary” to invade the principal to provide for those needs.
Relatedly, the evidence does not permit a finding that stepmother and defendants had agreed not only to live together
but that defendants would be responsible for stepmother’s
care, maintenance, and support in exchange for an immediate one-half-interest in the Kropf property and a future
one-half interest to be acquired by devise.3 The trial court
    3
       Given our conclusions, we need not address whether it would have been an
abuse of discretion for stepmother to invade principal in the manner that she did
even if she had deemed it necessary and had an agreement with defendants to
provide for her care. See Penny, 123 Cal App 4th at 603, 20 Cal Rptr 3d at 216 (If
“given discretionary power, the trustee must exercise his or her power reasonably,” and, “even if a trustee is given ‘sole’ and ‘absolute’ discretion, he or she must
act in accordance with fiduciary principles and must not act in bad faith or in
disregard of the purposes of the trust.”). Regarding reasonableness, defendants
790                                                   Cumming v. Nipping

therefore erred in concluding that stepmother’s invasion of
the trust principal to buy the Kropf property and deed it to
herself and defendants comported with the terms of the trust.
        Because stepmother failed to act in conformity
with the terms of the trust, the circumstances in which
she used trust assets to buy the Kropf property “in some
sense were wrongful,” satisfying the first Tupper requirement. Cumming I, 

. Again, we refer to
wrongfulness by reference to recognized legal principles,
not “abstract notions of morality.” 

.
B. Bona Fide Purchasers without Notice
          Having concluded that plaintiff established the first
requirement, we proceed to the second Tupper requirement:
establishing that defendants were not “bona fide purchaser[s] for value and without notice.” 

. That requirement is rooted in the constructive trust remedy. See Tupper,

. When property subject to a constructive
trust is transferred to a third party, if the third party is a
“mere volunteer” or had “actual or constructive notice of the
trust, then the rule is universal that such heir, devisee, successor, or other voluntary transferee, or such purchaser with
notice, acquires and holds the property subject to the same
trust which before existed, and becomes himself a trustee
for the original beneficiary.” 

 (ellipses omitted). “It
is not necessary that such transferee or purchaser should be
guilty of positive fraud, or should actually intend a violation
of the trust obligation; it is sufficient that he acquires property upon which a trust is in fact impressed, and that he is
not a bona fide purchaser for a valuable consideration and
without notice.” 

 (internal quotation marks omitted).4

cite Hollis v. Helton, 

 (Cal Ct App 2005) (unpublished disposition), as noncontrolling but “persuasive authority for what California courts consider appropriate invasions of trust principal for a person’s ‘health.’ ” But Hollis
is starkly different from this case, such that it lends no support to defendants’
position, even if we viewed it as persuasive authority. See California Rules of
Court, Rule 8.1115(a) (precluding citation to or reliance on unpublished opinions).
     4
       As an “alternative basis” to affirm the dismissal of plaintiff’s claim, defendants argue that, even if stepmother did not comply with the terms of the trust,
plaintiff cannot obtain relief against defendants and should have brought a claim
against stepmother or her estate. We reject that argument as contrary to the principles articulated in Tupper. Unless defendants were bona fide purchasers without
notice, they cannot rely on their third-party status to defeat a constructive trust.
Cite as 

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         Here, the trial court determined that defendants
were bona fide purchasers for value, having “contributed
substantial money and labor to make the Kropf property
habitable for [stepmother].” The court did “not find dispositive” defendant Laurie Nipping’s testimony that she considered the one-half interest that defendants received in the
Kropf property in 2010 a “gift,” because, in the court’s view,
there was evidence that stepmother’s “plan” to use the Kropf
property to provide for her health, maintenance, or support
depended on defendants expending money and labor to
make the house habitable. The trial court did not address
the “without notice” portion of the standard, nor do the parties address it on appeal. We therefore limit our discussion
to whether there was evidence to allow a determination that
defendants were bona fide purchasers “for value.”
         We agree with plaintiff that the trial court erred
in concluding that defendants were bona fide purchasers for
value based on stepmother’s “plan.” There is ample evidence
that defendants and stepmother planned to live on the
Kropf property together, that defendants were tasked with
making the house habitable, and that defendants supplied
labor and used some of their own money toward that end. It
does not follow that defendants were bona fide purchasers
for value. Unlike the trial court, we view as legally dispositive defendant Laurie Nipping’s testimony that the one-half
interest in the Kropf property that defendants received in
2010 was a “gift.” That evidence—which the court implicitly
found credible, just not “dispositive”—precludes any nonspeculative inference that there was an agreement between
stepmother and defendants that defendants would renovate
the house and live there with stepmother in exchange for
stepmother giving defendants an ownership interest in the
Kropf property.5 In taking on renovation of the property,
defendants may have expected to live there rent-free for the

     5
       The dissent emphasizes the fact that, for many years, defendant Laurie
Nipping had visited stepmother, provided companionship to her, and done things
for her. See, e.g., 310 Or App at 806-09 (Tookey, J., dissenting). It is certainly reasonable to presume that defendants expected that to continue. It is also reasonable to presume that defendants intended to include stepmother in their family
meals and the like if they lived together. But it does not follow that an implied
agreement existed by which stepmother had to give defendants $300,000 for their
continued familial support.
792                                                  Cumming v. Nipping

remainder of stepmother’s life or had other personal motivations. In any event, the evidence did not allow a determination that they were bona fide purchasers for value.6
C. Property that Rightfully Belongs to Plaintiff
        That leaves the third Tupper requirement. Plaintiff
had to establish by clear and convincing evidence that the
Kropf property—which is the property on which plaintiff
seeks to impose a constructive trust—“in fact is the very
property that rightfully belongs to her, or is a product of
or substitute for that property.” Cumming I, 

. The trial court did not expressly address that
requirement. However, it is undisputed—and, on this record,
indisputable—that the $300,000 obtained by mortgaging Seagate in 2010 was used to purchase the Kropf property. Defendants, who managed stepmother’s finances and
handled the Seagate refinancing and the Kropf purchase,
expressly testified that that is what happened. Closing
documents confirm that is what happened. As the record
allows for only one possible finding as to the third Tupper
requirement, we conclude that plaintiff satisfied the third
requirement.7
D. Alternative Basis to Affirm (Unclean Hands)
         In light of the foregoing analysis, the trial court
erred in concluding that plaintiff had not proved each of
the three Tupper requirements. As an “alternative basis”
to affirm, defendants argue that, even if plaintiff otherwise
proved unjust enrichment, we should affirm the dismissal
of her claim, based on plaintiff having “unclean hands.”
Specifically, defendants assert that plaintiff took improper
    6
      Of course, plaintiff’s claim pertains only to the $300,000 borrowed against
Seagate and used to purchase the Kropf property. To the extent that defendants
used their own money, their own labor, and stepmother’s personal funds to renovate the Kropf property, they will receive the benefit of those improvements.
    7
      We note that, under the terms of the trust instrument, stepmother as
trustee had the authority to change the trust beneficiaries and, as such, could
have changed the beneficiary of Trust B from plaintiff to defendants, at which
point defendants would have received Seagate upon stepmother’s death. The
trustee did not change the beneficiary of Trust B, however, whether to honor her
late husband’s wishes or otherwise. As such, the theoretical possibility that she
could have changed beneficiaries has no effect on plaintiff’s actual beneficiary
status or, more generally, on the correct construction of the trust terms regarding
invasion of Trust B principal.
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actions to transfer the title to Seagate to herself after stepmother’s death. See 310 Or App at 797.

         “Under the doctrine of unclean hands, a court may
refuse to grant equitable relief to a party who has engaged
in misconduct in connection with the matter for which he
or she seeks relief.” Burgdorf v. Weston, 

, 

 (2013), rev den, 

 (2014). The
misconduct must be serious enough to justify denying relief
on an otherwise valid claim—such as engaging in a crime,
fraud, or bad faith—as “[e]ven equity does not require saintliness.” 

 (internal quotation marks omitted). The party
who stands to benefit from invocation of the unclean-hands
doctrine also “must prove that he or she has suffered actual
injury due to the alleged misconduct.” 

 Here, even assuming arguendo that plaintiff’s conduct was of a nature that
would permit application of the doctrine, defendants have
not identified any actual injury that they have suffered as
a result of plaintiff’s conduct. It is undisputed that plaintiff and her children were legally entitled to receive title to
Seagate after stepmother’s death, plaintiff’s children have
purported to transfer their interests to plaintiff, and defendants have offered no evidence of any injury caused to them
by the particular manner in which Seagate’s title was transferred. We therefore reject plaintiff’s proposed alternative
basis to affirm.

        Reversed and remanded.

        TOOKEY, J., dissenting.
      “There is no medicine like hope, no incentive so great,
   and no tonics so powerful as expectation of something
   better tomorrow.” Dr. Orison Swett Marden, as quoted in
   Bits and Pieces, Vol. F/No. 41, at 14.

         On December 26, 2010, Ruth Whiteneck, at an
advanced age, died in the farmhouse that she had purchased to live in with her family for “however long she had
left.” She died in the bedroom that her granddaughter and
granddaughter’s husband had renovated for her use. At her
side when she died was her granddaughter, Ms. Nipping;
her granddaughter’s husband, Mr. Nipping; and one of her
794                                                 Cumming v. Nipping

great-grandchildren, H. Nipping. Absent was the plaintiff
in this case, Ms. Cumming.
         I would affirm the trial court’s decision, and I dissent in this case because I believe the majority gives too
short shrift to what it describes as “familial feeling.” 310
Or App at 788. In my view, Ms. Whiteneck’s actions—
purchasing a property to live in with her granddaughter and
great-grandchildren—were appropriate under the terms
of the trust that she and her late husband had designed.
As discussed below, the trust allowed for whichever one of
them survived the other to withdraw from the principal of
the trust, as needed, to provide for their health, education,
maintenance, and support, as the survivor grew older and
developed the infirmities of advanced age that inevitably
follow.
          In reviewing the trial court’s ruling in this case, I
am mindful of our standard of review: We “review the trial
court’s legal conclusions for legal error and review its factual
findings to determine whether those findings are supported
by any evidence in the record.” Multi/Tech Eng. Svcs. v.
Innovative Des. & Constr., 

, 

 (2015) (internal quotation marks omitted). In so doing,
“we view the evidence, as supplemented and buttressed by
permissible derivative inferences, in the light most favorable
to the trial court’s disposition and assess whether, when so
viewed, the record was legally sufficient to permit that outcome.” Wilson v. Gutierrez, 

, 

(2014) (brackets and internal quotation marks omitted).1
          I. FACTS AND PROCEDURAL HISTORY
        I first turn to the facts. In my view, understanding
Ms. Whiteneck’s decades-long relationship with her granddaughter, Ms. Nipping, and the Nipping family, is essential to understanding Ms. Whiteneck’s decision to withdraw trust principal, why withdrawing trust principal was

    1
      At the outset, I note that in this dissent I refer to individuals by their
names, rather than their role in the litigation or their relationship to the parties to this litigation. I do so for two reasons: First, defendants—Ms. Nipping
and Mr. Nipping—had different parts in the events that gave rise to this litigation. Second, although Ms. Whiteneck had the relationship of “stepmother” to
Ms. Cumming, 310 Or App at 781, she was “grandma” to Ms. Nipping.
Cite as 

 (2021)                                                   795

authorized under the terms of the trust, and the inferences
that the trial court permissibly drew from the evidence.2
A.    Trusts, the Whitenecks, the Nippings, and Ms. Cumming
        After Ms. Nipping was born, she went from the
hospital to Ms. Whiteneck’s home, where Ms. Whiteneck
served as Ms. Nipping’s primary caregiver for the first couple years of Ms. Nipping’s life; Ms. Whiteneck cared for
Ms. Nipping after Ms. Nipping’s mother returned to work.
Ms. Nipping and Ms. Whiteneck remained close throughout
Ms. Nipping’s childhood.
        In the 1970s, Ms. Cumming’s mother passed away
and, shortly thereafter, Ms. Cumming’s father married
Ms. Whiteneck. Ms. Cumming’s father, Mr. Whiteneck, had
only one child. Ms. Whiteneck had three children from a
prior marriage. Ms. Whiteneck and Mr. Whiteneck lived in
a condominium in California known as “Seagate.”
        In May 1991, Ms. Whiteneck and Mr. Whiteneck
set up a revocable living trust. Eight years later, in 1999,
Mr. Whiteneck passed away. Ms. Cumming and her husband were with Mr. Whiteneck when he passed, and they
stayed with Ms. Whiteneck that night. The next day,
Ms. Nipping came to take care of Ms. Whiteneck. The day
after Mr. Whiteneck’s death in 1999 was the last day that
Ms. Cumming ever saw or spoke to Ms. Whiteneck.

      2
        I pause to note that I am in full agreement with the majority that the
“issue here is not whether defendants should be financially rewarded for their
kind treatment of an older relative, so as to incentivize kind treatment of older
relatives.” 310 Or App at 789.
      I also agree with the majority that the issue in this case, instead, is “whether
[Ms. Whiteneck] complied with the terms of the trust instrument created by
[Ms. Whiteneck] and plaintiff’s father, when she encumbered Seagate in the
manner that she did.” Id. at 789. That inquiry, however, turns on what inferences
the trial court, as a legal matter, could have permissibly drawn from the evidence presented at trial, including evidence regarding the relationships between
Ms. Whiteneck and her family members. Indeed, as noted by the majority, the
trial court found “that [Ms. Whiteneck] was acting according to an implied agreement with defendants, by which defendants implicitly committed to ‘care for,
support, and maintain [Ms. Whiteneck] in her remaining years’ and to ‘provide
companionship, security and consistency’ for a potentially extended period.” 310
Or App at 786-87. In my view, to determine whether that finding was permissible,
it is necessary to consider the evidence presented at trial concerning the relationships and bonds at issue between Ms. Whiteneck and her family members, and in
particular, the relationship and bonds between Ms. Whiteneck and the Nippings.
796                                        Cumming v. Nipping

        During the trial in this case, Ms. Cumming
described her relationship with Ms. Whiteneck as “cordial”; Ms. Whiteneck, however, perceived Ms. Cumming as
“just waiting for her to die.” Prior to Mr. Whiteneck’s death,
events had taken place at Seagate that left Ms. Whiteneck
with the impression that Ms. Cumming was “very concerned” with what she would receive after Mr. Whiteneck
and Ms. Whiteneck died.
         Pursuant to the terms of the Whitenecks’ revocable
living trust, Mr. Whiteneck’s death resulted in the revocable
living trust being separated into two trusts—Trust A and
Trust B—of which Ms. Whiteneck was both the trustee and
a beneficiary.
        With regard to Trust A, known as the survivor’s
trust, Ms. Whiteneck was entitled to “all income and principal without limitation.”
         Trust B, known as the tax credit trust, was structured differently. With regard to the income from Trust B,
Article 2.10 of the trust provided that the trustee “shall pay
to or apply for the benefit of the surviving trustor, as much
of the net income as the trustee, in the trustee’s discretion,
shall deem necessary for the surviving trustor’s proper
health, maintenance, support and education,” taking into
consideration, “to the extent the trustee shall deem advisable, any other income or resources of the surviving trustor known to the trustee and reasonably available for these
purposes.”
        With regard to the principal from Trust B, Article
2.11 provided:
   “DISCRETION TO INVADE PRINCIPAL If the trustee
   deems income payments to be insufficient, the trustee shall,
   from time to time, pay to or apply for the benefit of the surviving trustor, a sum out of the principal of Trust B as the
   trustee, in the trustee’s discretion, deems necessary for the
   trustor’s proper health, maintenance, support and education. Such payment may be made after Trust A has been
   exhausted, or before Trust A is exhausted.”

(Emphases added.)
Cite as 

 (2021)                            797

         Importantly, as alleged in Ms. Cumming’s complaint, Seagate was allocated to Trust B, and Seagate became
the only asset of Trust B after the Whitenecks’ assets were
allocated between the two trusts and the expenses relating
to Mr. Whiteneck’s death were paid.
        At the time of Mr. Whiteneck’s passing, Ms. Nipping
lived in Newberry Park, California, which was about an
hour and a half away from Seagate. In 2000, Ms. Nipping
moved to Agoura Hills, California, which is about an hour
away from Seagate.
         From the time of Mr. Whiteneck’s death until 2005,
Ms. Nipping and her children visited Ms. Whiteneck often.
During visits they would frequently meet Ms. Whiteneck
for lunch at Mimi’s Café, because Ms. Whiteneck loved that
restaurant, and then would spend the afternoon with her.
In 2004, Ms. Whiteneck made Ms. Nipping the successor
trustee of Trust B. At some point, though the exact date is
unclear, Ms. Whiteneck told Ms. Nipping that Ms. Whiteneck
had mild dementia.
         In 2005, the Nippings moved to Oregon. After the
Nippings moved to Oregon, they had conversations with
Ms. Whiteneck about Ms. Whiteneck moving to Oregon as
well. At that point, however, Ms. Whiteneck was not ready
to leave Seagate. As time wore on, however, Ms. Whiteneck
grew increasingly solitary in California and was not leaving
her home with the same frequency as she had previously.
         In 2007, Ms. Whiteneck fell and sustained an
injury, after which Ms. Nipping traveled to California to see
Ms. Whiteneck. Ms. Nipping arranged for a care provider to
go to Ms. Whiteneck’s home approximately once a week to
generally check on Ms. Whiteneck and to spend time with
her. The care provider “reported to” Ms. Nipping, not to
Ms. Whiteneck.
         Also, in 2007, the Nippings received a call from
a “good friend” of Ms. Whiteneck who was concerned that
Ms. Whiteneck was spending “a lot of time in her home by herself” and thought it would be a good time for Ms. Whiteneck to
move to Oregon. In late 2007, Ms. Whiteneck agreed to move
to Oregon, with the plan that she would live in an assisted
798                                                   Cumming v. Nipping

living facility in Oregon. At that point, Ms. Whiteneck was
excited to move to Oregon to be closer to the Nipping family, who was then living in Creswell, Oregon. Ms. Whiteneck
was experiencing some degree of difficulty with her memory
at that time.3
         In preparation for Ms. Whiteneck’s move, the
Nippings looked for assisted living facilities near to their
home in Creswell in which Ms. Whiteneck could live. They
decided that a facility named Lone Oak would be a good
choice for Ms. Whiteneck because it was decorated similarly
to Seagate, and they liked the location and the grounds.
        In January 2008, Ms. Whiteneck moved to Oregon
and, for a brief time, lived with the Nippings until a
vacancy at Lone Oak opened up for Ms. Whiteneck. At that
time, the Nippings’ home did not have adequate room for
Ms. Whiteneck to move in with them on a long-term basis.
        After a vacancy at Lone Oak became available, Lone
Oak required a medical appointment for Ms. Whiteneck,
which Ms. Nipping also attended. During that medical
appointment, Ms. Nipping provided information to the doctor regarding Ms. Whiteneck, telling the doctor that she
believed Ms. Whiteneck’s memory had been getting progressively worse over the course of the prior two years.
        For a time after Ms. Whiteneck moved to Oregon,
the Nippings visited her once or twice a week, and after
that, they continued to visit her often. During those visits
they would talk, play cards, and “just spend time with her.”
        Additionally, after Ms. Whiteneck moved to Oregon,
the Nippings managed Ms. Whiteneck’s finances for her—Ms.
Nipping took responsibility for paying Ms. Whiteneck’s bills
(from Ms. Whiteneck’s accounts) and writing Ms. Whiteneck’s
checks, and she was also put onto Ms. Whiteneck’s checking
account. Additionally, the Nippings arranged for Seagate to
be rented and hired an accountant to do Ms. Whiteneck’s
taxes. Ms. Whiteneck’s rental income from Seagate was
“around” $2,000 a month.
     3
       The record contains conflicting testimony regarding Ms. Whiteneck’s mental acuity prior to her move to Oregon. For the purposes of this opinion, it suffices
to note that Ms. Whiteneck had some level of difficulty with regard to memory.
Cite as 

 (2021)                             799

         After Ms. Whiteneck had been living at Lone Oak
for about a year, the Nippings discovered an assisted living facility, Middlefield, that was much closer to their house,
which would allow the Nippings to see Ms. Whiteneck more
often. Ms. Whiteneck agreed to move to Middlefield in part to
be closer to the Nipping family. Additionally, at Middlefield,
Ms. Whiteneck would be able to have a one-bedroom apartment, whereas at Lone Oak, she only had a studio apartment. Ms. Whiteneck’s bills and rent at Middlefield were paid
for by pension benefits and social security Ms. Whiteneck
received.
         After Ms. Whiteneck moved to Middlefield,
Ms. Nipping visited her at least once a week. Additionally,
Ms. Whiteneck came to the Nippings’ home for “all of the
holidays” and, occasionally, “just to spend the day” with the
Nippings. Ms. Nipping would also pick up Ms. Whiteneck
from Middlefield so that Ms. Whiteneck could see her
great-grandchildren’s “evening activities,” such as performances and music recitals; activities that Ms. Nipping
thought would interest Ms. Whiteneck. Ms. Whiteneck
read the newspaper every morning and cut out articles of
interest to share with Ms. Nipping. One of Ms. Whiteneck’s
great-granddaughters checked Ms. Whiteneck’s voicemails
and messages for her when the great-granddaughter visited.
       In 2009, Ms. Whiteneck went to the hospital and
was diagnosed with congestive heart failure, after which
Ms. Whiteneck “declined a bit” but then “bounced back.”
         Subsequently, the Nipping family discussed moving
closer to the Portland, Oregon, area, because they believed
that there would be more opportunities for their children to
be involved in activities and that it would be beneficial to
Mr. Nipping’s business to be in a more metropolitan area;
Mr. Nipping is an electrical contractor.
         The Nippings discussed their plan to move closer to
Portland with Ms. Whiteneck, and discussed Ms. Whiteneck
moving too so that she could stay close to the Nipping family. Ms. Nipping thought that Ms. Whiteneck was “fine” with
the move, because Ms. Whiteneck “knew at the time that
she would be close” to the Nippings “wherever [they] went.”
800                                                     Cumming v. Nipping

Initially, the Nippings thought that perhaps Ms. Whiteneck
would move into a facility similar to Middlefield in the
Portland area.
         While searching for property closer to Portland,
however, the Nippings found a farmhouse for sale on Kropf
Road in Molalla, Oregon (the Kropf Property). They believed
the Kropf Property presented a “perfect situation” because it
would allow Ms. Whiteneck to live with the Nippings while
still having her own space, giving her the ability to be “separate from all the chaos of the kids.” 4 The Kropf Property
had a separate bedroom with an adjoining sitting room, and
a bathroom, which would be for Ms. Whiteneck’s use. The
Nippings took pictures of the Kropf Property and talked
with Ms. Whiteneck about the possibility of moving in with
the Nippings and being with them “24/7.” Ms. Nipping told
Ms. Whiteneck that she wanted Ms. Whiteneck to live with
the Nippings for “however long she had left.”
         Ms. Nipping discussed the view that Ms. Whiteneck
would have from her bedroom in the Kropf Property; being
able to have coffee and a glass of wine together; and generally “doing life together,” rather than “coming and going and
having short little visits.” Ms. Whiteneck looked forward to
living with the Nippings.
        At some point the Nippings discovered that, due to
the condition of the Kropf Property, it was not eligible for a
conventional loan and needed to be a “cash deal.” Additionally,
they had to move quickly if they wanted to purchase the
Kropf Property—there were other offers on it, and they were
worried that it would come off the market due to a foreclosure. As a result, they did not have time to wait for their
home in Creswell to sell so that they could partially finance
the purchase of the Kropf Property. Further, the money
Ms. Whiteneck had in her saving and checking accounts,
and the income from rental of Seagate, were not sufficient
to purchase the Kropf Property. So, Ms. Whiteneck, after
discussion with the Nippings, made the decision to encumber Seagate and use the proceeds from that encumbrance to
purchase the Kropf Property.

   4
       At that point, the Nippings had four children.
Cite as 

 (2021)                            801

        The title company utilized by Ms. Whiteneck and
the Nippings explained that, for the transaction to work,
Seagate needed to be removed from the trust, encumbered,
and then placed back into the trust once it was encumbered.
That is precisely what Ms. Whiteneck did.
        Ms. Whiteneck was never “hesitant” about the
transactions necessary to purchase the Kropf Property. She
did, however, sometimes “forget” and need to be “reminded”
about the transaction and that she would be moving in with
the Nippings.
         In October 2010, the transaction for the Kropf Property closed, and the property was deeded to Ms. Whiteneck
and the Nippings. During trial, Ms. Nipping testified that
she understood the interest that was in her and her husband’s name to be a “gift” from Ms. Whiteneck.
         The Nippings then moved into a trailer on the Kropf
Property and lived in the trailer while they worked on renovating the Kropf Property, with the plan that it would
be ready for Ms. Whiteneck to move into on February 1,
2011. The majority of the funds for the renovations came
from the Nippings, and Mr. Nipping performed the labor,
but Ms. Whiteneck also contributed funds for the renovations. Renovations undertaken by Mr. Nipping included
renovations to Ms. Whiteneck’s bedroom. During the renovations, Ms. Nipping showed Ms. Whiteneck photographs
of the progress that the Nippings were making on the renovations, and Ms. Whiteneck responded that she loved what
was being done to the property and that she was looking
forward to being there.
        But Ms. Whiteneck and the Nippings’ plan did not
come to fruition as intended.
         On December 21, 2010, Ms. Whiteneck was having
trouble breathing and went to the hospital. Ms. Nipping
stayed with Ms. Whiteneck in the hospital overnight that
night and, at that time, Ms. Whiteneck seemed “relatively
normal.” Ms. Nipping stayed with Ms. Whiteneck most of
the following morning as well.
        Ms. Nipping left the hospital on December 22, 2010,
and returned on December 23, 2010, at which time she was
802                                    Cumming v. Nipping

told that Ms. Whiteneck would be released and placed on
hospice care. Ms. Whiteneck, at that point, could not return
to Middlefield—the assisted living facility that she had been
living in—because she needed to be on hospice care.
         Ms. Nipping arranged for Ms. Whiteneck’s transport to the Kropf Property, and Ms. Whiteneck arrived at
the Kropf Property on Christmas Day. Also, on Christmas
Day, a hospice nurse went to the Kropf Property and set
up Ms. Whiteneck’s room with a hospital bed, a commode,
and “all of the things she felt they would need.” Ms. Nipping
talked to a hospice nurse for several hours about what
Ms. Whiteneck would need and what Ms. Nipping would
need to do for her. Ms. Nipping slept in Ms. Whiteneck’s sitting room at the Kropf Property on Christmas night so that
she could be close to Ms. Whiteneck.
       Ms. Whiteneck passed away the next day—
December 26, 2010. With her when she passed was
Ms. Nipping, Mr. Nipping, and the Nippings’ oldest
daughter—Ms. Whiteneck’s great-granddaughter.
         After Ms. Whiteneck’s death, her estate went through
probate, and her interest in the Kropf Property was transferred to Ms. Nipping.
B. The Instant Litigation
        After Ms. Whiteneck’s estate went through probate,
Ms. Cumming brought suit against the Nippings, alleging
claims of intentional interference with prospective inheritance and unjust enrichment. In its initial ruling, the trial
court denied Ms. Cumming’s claims.
         With respect to the intentional interference with
prospective inheritance claim, the trial court determined
that Ms. Whiteneck “did not lack contractual capacity” and
that the Nippings “did not exercise undue influence” over
Ms. Whiteneck. With respect to the unjust enrichment
claim, the trial court determined that it was not “inequitable or that it shocks the … conscience that the defendants
would retain the home,” noting that, “if Ms. Whiteneck had
not died when she did, if she had continued to live another
ten years, I don’t think there would have been an issue
Cite as 

 (2021)                                                 803

whatsoever,” and there was nothing “inequitable about
allowing the defendants to retain what they have.”
         Ms. Cumming appealed, and, on appeal, we vacated
the judgment and remanded as to Ms. Cumming’s unjust
enrichment claim for an analysis of the unjust enrichment
claim under the legal standard articulated in Tupper v.
Roan, 

, 

 (2010). Cumming v. Nipping,

, 

 (2017) (Cumming I).
We explained that, under Tupper, to “prevail in asserting
an unjust enrichment claim where, as here, the plaintiff has
alleged that the defendant (a third party) acquired property to which the plaintiff holds a superior right,” a plaintiff
must establish three elements. Cumming I, 

. Of importance to this dissent is the first element: that
“property or a property interest that rightfully belongs to
[the plaintiff] was taken or obtained by someone else under
circumstances that in some sense were wrongful or inequitable.” 

 (internal quotation marks omitted). Because I
would conclude that Ms. Cumming did not meet her burden
of proving the first element, I do not consider the other two
elements of her unjust enrichment claim in this dissent.5
         On appeal in Cumming I, with respect to the first
element of Ms. Cumming’s unjust enrichment claim, we
noted that Ms. Cumming needed to “demonstrate that she
had a legal right to Seagate without any encumbrances.”

. We explained that, to analyze that issue, the
trial court needed to “determine whether the trust allowed
[Ms. Whiteneck] to encumber Seagate and, if so, under what
terms” and that the court “then had to determine whether
[Ms. Whiteneck’s] actions comported with those terms.”

      On remand, the trial court again denied
Ms. Cumming’s unjust enrichment claim. The trial court

     5
       The other two elements of an unjust enrichment claim where, as here,
the plaintiff has alleged that the defendant (a third party) acquired property to
which the plaintiff holds a superior right, are that (1) “the person who now possesses the property is not a bona fide purchaser for value and without notice” and
(2) the property upon which the plaintiff seeks to impose a constructive trust is in
fact, by clear and convincing evidence, “the very property that rightfully belongs
to her, or is a product of or substitute for that property.” Cumming I, 

.
804                                       Cumming v. Nipping

determined that “Ms. Whiteneck’s purchase of the Kropf
property was for her health, maintenance or support”; the
“terms of the trust left the decisions on how to best provide for her ‘health, maintenance, support and education’
to the discretion of Ms. Whiteneck”; and the “record supports the finding that the purchase of the Kropf Road house
was Ms. Whiteneck’s valid exercise of that discretion.” Thus,
in the trial court’s view, “Ms. Whiteneck’s actions were in
accordance with the terms of the trust.” The trial court also
noted that, in its view, to “find otherwise would either be an
exercise in second-guessing Ms. Whiteneck’s decision about
how best to care for herself or in illogically restricting the
definition of health, maintenance or support.” The trial court
determined that “plaintiff has failed to demonstrate that
she had a legal right to Seagate free from encumbrances.”
         The trial court further determined that the “agreement between Ms. Whiteneck and defendants included
implicit and explicit obligations on the part of defendants.”
As explained by the trial court, the Nippings
   “had agreed to care for, support, and maintain Ms.
   Whiteneck in her remaining years. By sharing a home
   with Ms. Whiteneck, [the Nippings] would provide companionship, security and consistency for her. They entered
   into this obligation not knowing what the future would hold
   for Ms. Whiteneck. They were potentially agreeing to an
   extended period of care for an elderly and potentially ill
   person. It is not inequitable under the circumstances that
   the defendants obtained the Kropf property.”
                        II. ANALYSIS
        I begin my analysis by noting the points on which I
agree with the majority.
        I agree with the majority that the trust in this case
is governed by California law. 310 Or App at 786. And I also
agree with the majority that,
   “[u]nder California law, the trustee has a duty to administer the trust according to the trust instrument. In construing a trust instrument, the intent of the trustor prevails and it must be ascertained from the whole of the trust
   instrument, not just separate parts of it. Ordinary words
   must be given their normal, popular meaning and legal
Cite as 

 (2021)                                  805

   terms are presumed to be used in their legal sense. The
   trustee also must deal impartially with all beneficiaries,
   and, if given discretionary power, the trustee must exercise
   his or her power reasonably. Even if a trustee is given ‘sole’
   and ‘absolute’ discretion, he or she must act in accordance
   with fiduciary principles and must not act in bad faith or in
   disregard of the purposes of the trust.”

 (internal quotation marks and citation omitted).
         Additionally, as noted above, with regard to Trust B,
Article 2.11 of the trust provided:
   “DISCRETION TO INVADE PRINCIPAL If the trustee
   deems income payments to be insufficient, the trustee shall,
   from time to time, pay to or apply for the benefit of the surviving trustor, a sum out of the principal of Trust B as the
   trustee, in the trustee’s discretion, deems necessary for the
   trustor’s proper health, maintenance, support and education. Such payment may be made after Trust A has been
   exhausted, or before Trust A is exhausted.”
(Emphases added.)
        I agree with the majority that, under that provision,
Ms. Whiteneck could withdraw Trust B principal only if she
deemed Trust B income payments insufficient to provide for
her health, education, maintenance, and support (HEMS)
needs. 310 Or App at 786.
         I part ways with the majority, however, because I
disagree with the majority’s conclusion that the trial court
“erred in concluding that [Ms. Whiteneck’s] invasion of the
trust principal to buy the Kropf property and deed it to herself and defendants comported with the terms of the trust.”
Id. at 790. The majority so concludes because, in its view,
the “evidence does not allow a reasonable inference that
the condition precedent for invading Trust B principal had
been met—that is, that [Ms. Whiteneck] had deemed the
Trust B income payments ‘insufficient’ to meet [her] HEMS
needs and deemed it ‘necessary’ to invade the principal to
provide for those needs.” Id. at 789. “Relatedly,” the majority
concludes that “the evidence does not permit a finding that
[Ms. Whiteneck] and defendants had agreed not only to live
together but that defendants would be responsible for [Ms.
Whiteneck’s] care, maintenance, and support in exchange
806                                    Cumming v. Nipping

for an immediate one-half-interest in the Kropf property
and a future one-half interest to be acquired by devise.”
Id.

         In rejecting the trial court’s understanding of the
record, I believe the majority too quickly discounts the relationship, and the bonds of caretaking and support, that
had formed between Ms. Whiteneck and the Nippings;
Ms. Whiteneck’s ever-increasing reliance on the Nippings to
provide for her HEMS needs as she grew older and her memory continued to fail; and the Nippings concomitant willingness to meet such increasing needs, evinced by their actions
over the course of a decade. In my view, it is apparent that
the Nippings had assisted in providing for Ms. Whiteneck’s
health, maintenance, and support in an ever-increasing way
for many years, and Ms. Whiteneck had necessarily come
to rely on them for such care. And, as explained below, in
my view, the evidence was legally sufficient to support a
finding that Ms. Whiteneck “deemed it necessary” to withdraw principal from Trust B to meet her HEMS needs and
that her income from Trust B was insufficient to meet those
needs.

         As recounted above, the following occurred before
Ms. Whiteneck moved to Oregon: Ms. Nipping visited
Ms. Whiteneck the day after Ms. Whiteneck’s husband
died in 1999, and Ms. Nipping and her family visited
Ms. Whiteneck frequently thereafter until the Nippings
moved to Oregon in 2005; Ms. Whiteneck had mild dementia; when Ms. Whiteneck fell in 2007, Ms. Nipping traveled
to California from Oregon and arranged for a care provider
to periodically go to Seagate to check on Ms. Whiteneck and
spend time with her, and that care provider “reported to”
Ms. Nipping, not to Ms. Whiteneck; Ms. Whiteneck’s friend
called Ms. Nipping when she felt that Ms. Whiteneck was
becoming increasingly isolated in California and believed
that Ms. Whiteneck should move to Oregon; Ms. Whiteneck
was excited to move to Oregon because it would mean she
could be closer to the Nippings; and, in preparation for
Ms. Whiteneck’s move to Oregon, the Nippings looked for
assisted living facilities in which Ms. Whiteneck could live,
ultimately finding one that was decorated like Seagate.
Cite as 

 (2021)                            807

           After Ms. Whiteneck moved to Oregon: Ms. Whiteneck
lived with the Nippings for a time until a vacancy opened
up at the assisted living facility that she was to move
into; Ms. Nipping attended a doctor’s appointment with
Ms. Whiteneck and gave the doctor information concerning Ms. Whiteneck’s memory loss, specifically, that
Ms. Whiteneck’s memory had been getting progressively
worse over the course of the prior two years; the Nippings
managed Ms. Whiteneck’s finances, including arranging
for Seagate to be rented, and hired an accountant to file
Ms. Whiteneck’s taxes; Ms. Whiteneck switched assisted
living facilities to be closer to the Nippings after the
Nippings found a facility closer to their home that they
believed Ms. Whiteneck would prefer; the Nippings visited
Ms. Whiteneck frequently at the assisted living facilities at
which she stayed; Ms. Whiteneck went to the Nippings home
for all of the holidays and attended her great-grandchildren’s
“evening activities” with the Nippings; and Ms. Whiteneck
shared articles she found interesting with Ms. Nipping.

         It is against that backdrop—i.e., the Nippings caring
for Ms. Whiteneck and Ms. Whiteneck relying on such care—
that, when the Nippings decided to move to the Portland
area from Creswell, they approached Ms. Whiteneck about
moving in with them, and Ms. Whiteneck decided to do so. To
effectuate moving into the property that was chosen for that
purpose, it was necessary for Ms. Whiteneck to withdraw
principal from Trust B, and the only asset of Trust B was
Seagate. Ms. Whiteneck and the Nippings were informed by
the title company that, to borrow against Seagate, Seagate
needed to be removed from the trust, encumbered, and then
placed back into the trust, which is precisely what occurred.

         With that understanding of the record—and, in particular, the relationship of caretaking and support between
the Nippings and Ms. Whiteneck, that Ms. Whiteneck had
come to rely on the Nippings for her HEMS needs, that
the Nippings were moving from Creswell to the Portland
area, and that the Kropf Property transaction required
Ms. Whiteneck to withdraw from the principal of the Trust
B—the evidence was legally sufficient to support a finding
that Ms. Whiteneck “deemed it necessary” to withdraw
808                                                   Cumming v. Nipping

principal from Trust B to meet her HEMS needs and that
her income from Trust B was insufficient to meet those
needs.6
         Support and maintenance are “not limited to the
bare necessities of life.” 

(c)(2). And the
importance of companionship, security, and consistency for
the elderly—which the Nippings provided to Ms. Whiteneck
in spades—cannot be overstated.7
     6
       In the majority’s view, “if the terms of the trust had been followed, the
trustee presumably could have sold or encumbered Seagate while leaving it in
trust.” 310 Or App at 787 n 2. But, on this record, it would be speculation, not a
presumption, for us to determine both that Ms. Whiteneck (1) could have sold or
encumbered Seagate while leaving it in the trust and still effectuated the transaction and (2) that she was aware that she could have effectuated the transaction
while leaving Seagate in the trust, and thus would not have deemed it “necessary” to undertake the Kropf Property transaction in the manner that it was
undertaken.
     In any event, it was Ms. Cumming, not the Nippings, who bore the burden of
proof in this case. No evidence that the trial court was required to credit suggests
that the transaction in this case could have been effectuated in the manner the
majority presumes it could have been effectuated.
     7
       The importance of maintaining strong familial relationships as people age
is well-documented, as are the positive effects that those relationships have on
the health of the elderly; the negative effects associated with the absence of those
relationships are also well-documented. See generally Preeti Malani, Only the
Lonely: Poll Shows Many Older Adults, Especially Those with Health Issues, Feel
Isolated, Michigan Institute for Healthcare Policy & Innovation News (Mar 4,
2019), https://ihpi.umich.edu/news/only-lonely-poll-shows-many-older-adultsespecially-those-health-issues-feel-isolated (accessed Jan 5, 2021) (“[N]ew findings amplify research that has shown links between chronic loneliness and health
issues ranging from memory loss to shorter lives.”); Hearings on Aging without
Community: The Consequences of Isolation and Loneliness Before the S Spec
Comm on Aging, 115th Cong, 1st Sess, 5-6 (Apr 27, 2017) (statement of Julianne
Holt-Lunstad, Ph.D., Professor of Psychology and Neuroscience, Brigham Young
Univ) (“[Isolation has] a consistent and significant effect on mortality risk, and
the magnitude is comparable and in many cases exceeds that of other wellaccepted risk factors, including smoking up to 15 cigarettes per day, obesity, and air pollution.”); Harvard Health Publishing, Can Relationships Boost
Longevity and Well-being?, Harvard Health Letter (June 2017), https://www.
health.harvard.edu/mental-health/can-relationships-boost-longevity-and-well-being (accessed Jan 5, 2021) (“People who are more socially connected to family, friends, and community are happier, healthier, and live longer than people
who are less well connected.”); Leland Kim, Loneliness Linked to Serious Health
Problems and Death Among Elderly: UCSF Researchers Find Social Factors Play
Major Role in Older Adults’ Health, UCSF News (June 18, 2012), https://www.
ucsf.edu/news/2012/06/98644/loneliness-linked-serious-health-problems-anddeath-among-elderly (accessed Jan 5, 2021) (“[L]oneliness is independently associated with an increased rate of death and functional decline.”); John T. Cacioppo,
Loneliness: Human Nature and the Need for Social Connection 108 (2008) (“[W]e
see loneliness on the list of serious risk factors for illness and early death, right
alongside smoking, obesity, and lack of exercise.”); Sightlines Project, Stanford
Cite as 

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         Additionally, in my view, the evidence was legally
sufficient for the trial court to determine that there was an
agreement between Ms. Whiteneck and the Nippings, which
“included implicit and explicit obligations on the part of” the
Nippings, and under which that the Nippings “had agreed
to care for, support, and maintain Ms. Whiteneck in her
remaining years.”
         The agreement between the Nippings and
Ms. Whiteneck is evidenced by the Nippings actions vis-
à-vis Ms. Whiteneck historically, which included assisting
her with her health, maintenance, and support, thereby
demonstrating their willingness to provide such care for
Ms. Whiteneck after she moved in with them. It is also evidenced by their offer to Ms. Whiteneck, who, at the time, was
living in an assisted living facility, to come live with them at
the Kropf Property if they were able to secure the property.
In my view, it strains credulity to posit that the Nippings
were not agreeing to assist in providing for Ms. Whiteneck’s
HEMS needs when, knowing she was presently living in an
assisted living facility, they offered her the opportunity to
move in with them.
         The agreement between the Nippings and
Ms. Whiteneck is further evidenced by the Nippings’ actions
following the purchase of the Kropf Property: As agreed
to by the Nippings and Ms. Whiteneck prior to purchase
of the Kropf Property, the Nippings undertook to renovate
the Kropf Property, including Ms. Whiteneck’s bedroom
for Ms. Whiteneck’s use; the Nippings periodically updated
Ms. Whiteneck with information concerning the renovations; when Ms. Whiteneck went to the hospital in December
2010, Ms. Nipping communicated with hospital staff regarding her condition; when Ms. Whiteneck was placed on hospice, the Nippings arranged for Ms. Whiteneck’s transport
to the Kropf Property; Ms. Whiteneck met with a hospice
worker for several hours to discuss what Ms. Whiteneck

Center on Longevity, Stanford University, Social Engagement, https://longevity.
stanford.edu/social-engagement/ (accessed Jan 21, 2021) (“Mounting evidence
consistently demonstrates the relationship between social engagement and higher
levels of physical, mental, and cognitive functioning and its association with longer life spans. By contrast, socially isolated individuals face health risks comparable to those of smokers. Their mortality risk is twice that of obese individuals.”).
810                                      Cumming v. Nipping

would need and what Ms. Nipping would need to do for her;
Ms. Nipping slept in Ms. Whiteneck’s sitting room at the
Kropf Property on Christmas night so that she was close
to Ms. Whiteneck; and Ms. Nipping, Mr. Nipping, and one
of Ms. Whiteneck’s great-grandchildren, H. Nipping, stayed
with Ms. Whiteneck when she passed.
         Thus, as I see it, legally sufficient evidence supports
a determination that, part and parcel with Ms. Whiteneck
moving out of assisted living and in with the Nippings on the
Kropf Property, there was an agreement that the Nippings
would assist Ms. Whiteneck with her HEMS needs—
potentially for an extended period of time. That is, when the
Nippings invited Ms. Whiteneck to live with them, it was
not merely to “include stepmother in their family meals and
the like.” 310 Or App at 791 n 5.
         Finally, I observe that, given the majority’s analysis,
the majority does not reach the issue of whether “it would have
been an abuse of discretion for [Ms. Whiteneck] to invade
principle in the manner that she did even if she had deemed
it necessary and had an agreement with [the Nippings] to
provide for her care.” 310 Or App at 789 n 3 (emphasis in
majority). For the purposes of this dissent, it suffices to say
that, on this record, given our standard of review, I would
determine that Ms. Whiteneck did not abuse her discretion
as trustee. In re Greenleaf’s Estate, 101 Cal App 2d 658, 662,

 (1951) (“[T]he basic inquiry, whenever the
exercise of a trustee’s discretion, absolute or otherwise, is
challenged, is always whether the trustee acted in the state
of mind contemplated by the trustor.”).
          In contending that the “evidence does not allow
a reasonable inference that the condition precedent for
invading Trust B principal had been met—that is, that
[Ms. Whiteneck] had deemed the Trust B income payments
‘insufficient’ to meet her HEMS needs and deemed it ‘necessary’ to invade the principal to provide for those needs” 310
Or App at 789—the majority makes a number of arguments
and observations, none of which, in my view, are dispositive
as to the issues before us. I address three such arguments
and observations below.
Cite as 

 (2021)                             811

        First, the majority notes that it is “undisputed that
[Ms. Whiteneck] had sufficient income to fully cover living
costs and bills.” Id. at 787.
         It is true that it is undisputed that Ms. Whiteneck’s
bills and rent at the assisted living facility at which she
lived were fully paid for by pension benefits and social
security that Ms. Whiteneck received. But, with regard to
whether Ms. Whiteneck could withdraw from the principal of Trust B, the question before the trial court was not
whether Ms. Whiteneck’s income in toto was sufficient to pay
for her HEMS needs. Instead, it was whether her income
from Trust B was sufficient to pay for her HEMS needs
and whether she deemed it necessary to withdraw principal from Trust B to pay for those needs. That is, under the
terms of Trust B, Ms. Whiteneck could deem it “necessary”
to withdraw principal from Trust B to cover her HEMS
needs, notwithstanding that she had assets other than
Trust B principal available to her for her HEMS needs. See

(c)(2) (“In determining whether a power
is limited by an ascertainable standard, it is immaterial
whether the beneficiary is required to exhaust his other
income before the power can be exercised.”).
        In this case, Ms. Whiteneck’s income from Trust B
consisted of the income from the rental of Seagate (which
was the only asset of Trust B) and amounted to approximately $2,000 per month. 310 Or App at 782. In my view,
Ms. Whiteneck could have deemed $24,000 a year (i.e., the
income payments from Trust B) insufficient to provide for
her HEMS needs—particularly in view of her living at an
assisted living facility—satisfying that condition precedent
to withdraw the principal of Trust B.
         Second, the majority observes that the Nippings’
offer to live with Ms. Whiteneck was not expressly “contingent” upon Ms. Whiteneck giving the Nippings “a
50-percent or 100-percent interest in the Kropf property or
otherwise paying them” and that Ms. Nipping testified that
she understood the interest in the Kropf Property deeded
to the Nippings to be a “gift.” Id. at 788. But the fact that
Ms. Whiteneck had no legal obligation to transfer the Kropf
Property to the Nippings by deed and devise does not mean
812                                     Cumming v. Nipping

that the trial court could not determine, on this record, that
Ms. Whiteneck deemed doing so necessary for her HEMS
needs.
         Third, the majority argues that, in its view, the
“trust specifically provided that [Ms. Whiteneck] could
sell Seagate and buy a replacement home of comparable or
lesser value,” and that that “replacement home would necessarily be a trust asset.” Id. at 787. To be sure, Article 2.12
of the trust allowed Ms. Whiteneck to sell Seagate, but I
do not understand it to compel Ms. Whiteneck to purchase
a replacement home for herself in the event that she sold
Seagate, or require that a property purchased for her HEMS
needs be made a trust asset, particularly where purchasing
such property for her HEMS needs as a trust asset was not
an apparent option.
         In sum, I would conclude that the trial court did not
err when it determined that “Ms. Whiteneck’s actions were
in accordance with the terms of the trust” and that to “find
otherwise would either be an exercise in second-guessing
Ms. Whiteneck’s decision about how best to care for herself
or in illogically restricting the definition of health, maintenance or support.” Thus, in my view, the trial court did
not err when it determined that “plaintiff has failed to
demonstrate that she had a legal right to Seagate free from
encumbrances.”
        In light of the foregoing, I respectfully dissent.