## Facts

- In 1959, Anne Hamilton Killian created an irrevocable inter vivos trust funded from family assets.
- Upon Anne’s death, part of the trust corpus was divided into two equal trusts for her son, John Richard Killian, and her daughter.
- John’s trust authorized the trustee to make discretionary distributions for the “maintenance and support” of John, “his wife, and his descendants,” and contained no clause terminating such distributions upon John’s death.
- The trust granted John a testamentary power of appointment permitting him to appoint to his wife an amount “not exceeding one-third” of the residuary trust estate remaining at John’s death.
- When the trust was executed, John was married to Donna; they later divorced and had children, including three who became objectors.
- John later married Jan Barbour Killian, who was his wife at his death.
- John’s will exercised the power of appointment in favor of Jan for the maximum permitted one-third share.
- The trustee sought judicial instructions concerning Jan’s interests in the trust remainder and distribution rights after John’s death.
- John’s children argued (1) “wife” meant Donna (the spouse at execution), not Jan, and (2) any post-death support to Jan from the remaining trust would conflict with the settlor’s intent and effectively exceed a one-third limit.

## Issues

1. Whether “wife,” as used in the trust and in the testamentary power of appointment, referred to John’s spouse at the time of trust execution or the spouse at John’s death.
2. Whether, after John’s death and exercise of the power of appointment, Jan remained an eligible beneficiary for discretionary support distributions from the unappointed portion of the trust.
3. Whether the trust should be construed to limit a non-descendant spouse’s total benefit to no more than one-third of the trust estate.

## Decision

- The Iowa Supreme Court granted further review, vacated the court of appeals’ decision, and affirmed the district court.
- “Wife” referred to the person who was John’s wife at his death; John validly exercised the power of appointment in favor of Jan.
- The trust permitted the trustee to continue discretionary distributions for the support of John’s wife after John’s death because the instrument did not terminate that benefit upon his death.
- The one-third cap limited only the amount John could appoint outright to his wife at death; it did not impliedly cap the spouse’s eligibility for discretionary distributions from the remaining trust property.
- The court rejected the argument that the settlor intended, without express language, to restrict a later spouse’s participation in trust benefits to one-third.

## Legal Principles

- The controlling objective in trust construction is the settlor’s intent, determined primarily from the instrument’s language, distribution scheme, and relevant circumstances at execution.
- Courts apply technical rules of construction only when ambiguous language creates genuine uncertainty as to intent.
- Generic family-status terms (e.g., “wife”) may be construed as status-based rather than person-specific when the instrument does not name an individual and the operative provisions are keyed to a future event (such as the beneficiary’s death).
- A limitation within a testamentary power of appointment restricts the donee’s dispositive authority as stated; courts will not infer broader, unstated limitations on other benefits permitted by the trust’s separate distribution provisions.
- In equitable trust proceedings, appellate review is de novo with appropriate weight given to trial-level fact findings.

## Conclusion

The court held that “wife” meant John’s spouse at his death, validating the appointment to Jan of up to one-third of the remaining trust, and further held that Jan remained eligible for discretionary support distributions from the balance because the trust did not terminate spousal support rights upon John’s death and contained no express cap on a spouse’s overall benefit beyond the appointment limit.


In re Tr. of Killian, 459 N.W.2d 497 (Iowa 1990)