Land Agreement Under Reformed FLDS United Effort Plan Trust Upheld

In Town of Colorado City v. United Effort Plan Trust, (D AZ, May 8. 2013), an Arizona federal district court gave a victory to the state of Utah in its efforts to reform the United Effort Plan Trust which holds property occupied by members of the polygamous Fundamentalist Church of Latter Day Saints (FLDS). In this lawsuit, the twin towns of Colorado City, Arizona and Hildale, Utah (along with their water and electric companies) sought a declaratory judgment as to (1) whether transfers of property by the court-appointed special fiduciary are constitutional, and (2) whether the Cookes who occupy a parcel of land under a 2008 agreement with the special fiduciary or Robert Black who previously occupied it through a 1999 oral agreement under the unreformed trust have a legal right to it.

As to the constitutional issue, the court held that while the claim was not barred by res judicata or collateral estoppel (see prior posting), the towns are barred by the doctrine of laches from asserting their claims:

Plaintiffs waited years to assert that claim, during which hundreds of property transactions were completed in reliance on the validity of the reformed trust and Mr. Wisan’s actions

On the question of right to occupancy, the court ruled in favor of the Cookes.  It focused on language in the trust at the time Black obtained his occupancy rights: "use of property owned by the United Effort Plan Trust is not and does not
become a right or claim of anyone who may benefit in any way from the Trust." It also concluded that the statute of frauds precludes Black from asserting a claim of property rights and that Black has abandoned any rights he had in the property.