2018-0309, In re Trust of Mary Baker Eddy

(Australia) appeals an order of the Circuit Court (King, J.), denying it standing DONOVAN, J. The Second Church of Christ, Scientist, Melbourne

of Charitable Trusts. trusts, on the brief, and Mr. Donovan orally), for the Attorney General, Director charitable trusts, and Charles D. Shockley, assistant directo r of charitable Gordon J. MacDonald, attorney general (Thomas J. Donovan, director of

Trustees of the Clause VI Trust and Clause VIII Trust. Raymond, and Michael P. Courtney on the brief, and Mr. Hilliard orally), for the Upton & Hatfield, LLP, of Concord (Russell F. Hilliard, James F.

the Second Church of Christ, Scientist, Melbourne (Australia). Foehl & Eyre, PC, of Glenside, Pennsylvania (Robert B. Eyre on the brief), for Piper LLP, of Wilmington, Delaware (Stuart Brown on the brief and orally), and Pierce Atwood LLP, of Portsmouth (Michele E. Kenney on the brief), DLA

No. 2018 - 0309 7 th Circuit Court - Dover Probate Division

address of the court’ s home page is: http://www.courts.state.nh.us/supreme. available on the Internet by 9:00 a.m. on the morning of their release. The direct by e - mail at the following address: reporter@courts.state.nh. us. Opinions are corrections may be made before the opinion goes to press. Errors may be reported Doe Drive, Concor d, New Hampshire 03301, of any editorial errors in order that requested to notify the Reporter, Supreme Court of New Hampshire, One Charles formal revision before publication in the New Hampshire Reports. Readers are NOTICE: This opinion is subject to motions for rehearing under Rule p. 2 22 as well as 2

Board of Directors. trustees of the Clause VIII Trust have all been members of the Mother Church constitute the sole trustees” of the Clause VIII Trust. Since the 1949 letter, the Christian Science Board of Directors who are the surviving trustees . . . shall necessary to fill the vacancy [of Mr. Fernald]” and that the “five members of the the probate court, in a letter to t he trustees, concluded that it was “not Eddy’s estate, until Mr. Fernald’s death in 1949. At that time, Judge Lord of Directors of the Mother Church and Josiah Fernald, the administrator of Mrs. T he trustees of the Clause VIII Trust were comprised of the Board of

years. filed in the Concord Probate Court (now, Circuit Court) for over one hundred accounts for both trusts, and requests for appointments of trustees, have been of this litigation, court oversight of the trusts commenced, and annual and real residuary purpose” of Mrs. Eddy. Chase, 99 N.E. at 41 5. As a result promotion and extension of the religion of Christian Science the “dominating construction of the Clause VIII T rust manifests a purpose to make the Chase v. Dickey, 99 N.E. 410 (Mass. 191 p. 2 2), wherein the court held that the The Massachusetts Supreme Judicial Court reached a similar conclusion in N.H. 393, 400 - 01 (1912); see also Fernald v. Church, 77 N.H. 108, 109 (191 3). the relig ion of Christian Science as taught by [Mrs. Eddy].” Glover v. Baker, 76 trust for two purposes, church building repair and “promoting and extending the trusts and established that the bequest in Clause VIII was to be held in In previous litigation concerning these trusts, we upheld the validity of

Christian Science as taugh t by [Mrs. Eddy].” the purpose of more effectually promoting and extending the religion of and such portion of the principal as may be deemed wise,” shall be used “for building” and her former home in Boston and that “the balance of said income, necessary shall be used for the purpose of keeping in repair the chur ch alia, that “such portion of the income of [her] residuary estate as may be Massachusetts, in trust,” for certain “general purposes.” She directed, inter T he Mother Church ― The First Church of Christ, Scientist, in Boston, Eddy’s will devised “all the rest, residue and remainder of [her] estate . . . to for indigent, well educated, worthy Christian Scientists.” Clause VIII of Mrs. Mother Church” $100,000 in trust “for the purpose of providing free instruction Clause VI Trust bequeathed to the “Christian Science Board of Directors of T he testamentary trusts, known as the Clause VI Trust and Clause VIII Trust. The Christ, Scien tist, and, upon her death in 1910, her will established two The relevant facts follow. Mary Baker Eddy founded T he First Church of

I. Factual and Procedural Background

will of Mary Baker Eddy. We affirm. to request affirmative relief and enforce certain charitable trusts created by the p. 3 3

interest standing is not warranted.” continued to take, an active role in monitoring the Clause VIII Trust, “special Clause VIII [Trust].” The DCT concluded that because his office had, and the t rustees, which included a “review [of] the distributions made from the concerns, the DCT outlined a review plan that he intended to undertake w ith Church, they have embedded conflicting fiduciary obligations.” In light of these trustees of the Clause VIII Trust are also the Board of Directors of the Mother distributions for church repairs. The DCT further opined that “[b]ecause the Christian Science, and the court’s approval of the 199 p. 3 3 stipulation prioritizing VIII T rust distributions primarily to promoting and extending the religion of between the 1912 decision in Chase, 99 N.E. at 415, that devoted the Clause the religion of Christian Science.” The DCT also acknowledged the tension (1) repa ir of the Mother Church building(s); and (2) “promoting and extending “tension” between the two beneficial purposes of the Clause VIII Trust, namely: memorandum, t he DCT recognized that prior litigation had arisen from the Clause VIII Trust’s decision making concerning its distributions.” In his special interest standing, especially in light of the DCT’s “plan to review the a memorandum in April 2016 asserting that Second Church did not have responded to the concerns voiced by Second Church. Thereafter, t he DCT filed Notably, prior to the court’s scheduling order, the DCT had not

cooperate to resolve concerns raised by Second Church and the DCT. withdraw its motion a nd the DCT, Second Church, and the t rustees would issue because the parties agreed at the hearing that Second Church would However, the court did not rule on Second Chur ch’s motion or the standing doctrine. The court scheduled a hearing to address the issue of standing. Church responded by arguing that it had standing under the special interest that Second Chur ch, as a “branch church,” lacked standing to sue. Second DCT assented to Second Church’s motion, the trustees objected on the basis potentially object to, the annual accounting filed by the trustees. Although the alleged qualified beneficiary of the Clause VIII T rust, sought to review, and The current litigation commenced in 2015, when Second Church, an

be invaded with court approval. trust were prohibited; and ( p. 4 4) the princip al of the Clause VIII Trust could only C hristian Science, at the discretion of the trustees; ( p. 3 3) further loans from the available, remaining income to be applied to the promotion and extension of Clause VIII Trust income was to be used to repair the church, with any the Mother Church agreed to repay the loan to the Clause VIII Trust; (2) the trustees of the Clause VIII T rust. The stipulation p rovided, inter alia, that: (1) Probate Court (Cushing, J.) approved a stipulation between the DCT and t he T rust to the Mother Church to be used to fund a failed television venture, the Charitable Trust s (DCT) into a five million dollar loan from the Clause VIII In 1993, following an investigation by the New Hampshire Director of 4

Standing to Sue in the Charitable Sector, 28 U.S.F. L. Rev. 37, 61 (1993) the Blasko test. See Mary Grace Blasko, Curt S. Crossley, David Lloyd, interest standing, the trial court applied a five - factor test, often referred to as After considering how other courts have applied the doctrine of special

large.” Hooker v. Edes Home, 579 A.2d 608, 612 (D.C. 1990). continue d performance of the trust distinguishab le from that of the public at an individual seeking enforcement of the trust has a ‘special interest’ in court also found that courts have recognized an exception to this rule “where rel. Nixon v. Hutcherso n, 96 S.W.3d 81, 83 - 8 p. 4 4 (Mo. 2003). However, the trial Inc., v. Knapp Found ation, 479 N.E.2d 752, 755 (N.Y. 1985); see also State ex generally not entitled to sue for enforcement of the trust. See Alco Gravure, d etermined that most jurisdictions have ruled that a possible beneficiary is standing. Looking to other jurisdictions for guidance, the trial court possible beneficiary of a charitable trust, like Second Church here, has The court further noted that New Hampshire law is unclear as to whether a trust is properly executed. See Petition of Burnham, 74 N.H. 492, 494 (1908). to ensure that the rights of the public in the trust are protected and that the trust is determined to be charitable, it becomes the duty of the attorney general In its order, the trial co urt acknowledged the general rule that when a

considered the challenge to Second Church’s standing as a motion to dismiss. standard by which it decided the standing issue ― i.e., whether the trial court note that in making this determination, the trial court did not identify the Church failed to satisfy its burden to demonstrate that it had standing. We In March 2018, the trial court issued an order finding that Second

trustee and filing a memorandum on standing. Second Chur ch responded by moving for the appointment of an independent hearing, the t rustees filed a memorandum concerning the issue of standing. determined. The court scheduled a hearing for November 2017. Prior to the despite the fact that its standing to participate in this matter had not yet been pleading as well as a status report and a request for time to conduct discovery, amicus curiae. The t rustees objected. Second Church filed a responsive alia, amend the 1993 order. Second Church, again, sought to submit a brief as Subsequently, the trustees submitted an assented - to motion to, inter

this matter. See RSA p. 5 56 p. 4 4 - B:4 - 405(c) (2007). share information with the DCT who, by statute, represents their interests in denied Second Church’s motion, but indicated that Second Church should t rustees to file accounts audited by an independent auditor. The court also voicing its continuing concerns. The trial court issued an order requiring the account. Second Church moved f or authorization to file an amicus c uriae brief motion, as sented - to by the DCT, to, among other things, approve an amended 2016, the DCT and trustees reached an agreement and t he t rustees filed a Thereafter, f ollowing the DCT’s objection to the trustees’ accounts filed in 5

or evidentiary hearing, we assume without deciding that the trial court viewed determining that Second Church lacked standing, and there was no discovery Because the trial court did not clarify how i t reviewed the pleadings in

as a matter of law. disturb the trial court’s standing determination unless it is plainly erroneous de novo. However, the trustees and the DCT further argue that we should not whether to adopt special interest standing is a question of law which we review interest standing factors de novo. The DCT argues that the question of Church argues that we should review the trial court’s application of the special this case, the par ties dispute the applicable standard of review. Second Estate of Locke, 148 N.H. 7 p. 5 54, 755 (2002); see also RSA 567 - A:4 (2007). In unsupported by the evidence or plainly erroneous as a matter of law. In re We generally will not disturb the circuit court’s decree unless it is

A. Standing Issue

trustees. Second Church lacks special interest standing. We agree with the DCT and the DCT and the trustees maintain that the trial court properly determined that a sp ecial interest in a particular charita ble trust to enforce that trust,” both t he that we should “recognize the standing of certain persons or entities that have facts to demonstrate standing. Although the DCT agree s with Second Church factual record, while also faulting Second Church for not developing sufficient the trial court improperly reached its decision without the development of a T rust sufficient to justify standing. Moreover, Second Church contends that beneficiaries under the t rusts, it has a “special interest” in the Clause VIII asserts that, under the Blasko test, as one of a limited number of potential properly adopted the Blasko test, it misapplied the factors. Second Church On appeal, Second Church argues that, even though the trial court

II. Analysis of Second Church’s Claims

motion for reconsideration, which the trial co urt denied. This appeal followed. weighed in favor of granting Second Church standing. Second Church filed a Applying the Blasko test, t he trial court found that none of the factors

charity; and ( p. 5 5) the social desirability of conferring standing. Id. at p. 6 61. effectiveness; (4) the nature of the benefitted class and its relationship to the sought; (2) the presence of bad faith; (3) the attorney general’s availability and are: (1) the extraordinary nature of the acts complained of and the remedies plaintiff in order to enforce a charitable trust. See generally id. The factors distinct enough from the public at large to justify conferring standing upon the law and it sets forth five factors to determine whether a plaintiff’s interest is (hereinafter, “Blasko”). The test is based upon a comprehensive survey of case 6

are not in dispute, de novo review is mo re appropriate. Although this is true, we have the majority of the record before us, and, because the material facts benefit of having the entire probate record before him when deciding the issue of standing. standard because the trial court judge had presided over this case for seve ral years and had the Nonetheless, the trustees and the DCT, at oral argument, advocated for a plainly erroneous find any facts and it would be inappropriate to defer to its factual findings or rulings of law. In this case, because there was no evidentiary hearing, the trial court did not necessarily N.H. at 755. unsupported by the evidence or plainly erroneous as a matter of law.” In re Estate of Locke, 148 altered this standard and provides that “[w]e will not dist urb the probate court’s decree unless it is plainly erroneous that such findings could not be reasonably made.” Our case law has somewhat A:4 states, in relevant part: “The findings of fact of the judge of probate are final unless they are so We note that the plainly erroneous language derives from case law and RSA 5 p. 6 67 - A:4. RSA 567 - 1

class “ha s a justiciable interest in enforcement of the trust.” Id.; see Alco jurisdictions have recognized an exception to this rule when a clearly identified Hooker, 579 A.2 d at p. 6 612. Nonetheless, the R estatement as well as other

trust. number of individuals who might benefit incidentally from the from recognition of a cause of action by any and all of a large the trust res and trustee of vexatious litigation that would result constantly shifting benefit ed class, and the recurring burdens on distinct justiciable interest on the part of a member of a large and officer stems from the inherent impossibility of establishing a Principally, the rationale for vesting exclusive power in a public

As another court has framed the issue: Haverhill, 101 N.H. 41 p. 6 6, 419 (1958); Restatement (Third) of Trusts, supra at 4. to protect the rights of the public in charitable trusts); Concord Nat. Bank v. Rochester Trust Co., 115 N.H. 74, 76 (1975) (the attorney general has the duty charitable trusts. See RSA 564 - B:4 - 405(c); RSA 7:20 (2013); Attorney Gen. v. and duty to represent the public in the enforcement and supervision of attorney general (or the DCT, as his representative) has the statutory power See Restatement (Third) of Trusts § 94 cmt. g at 8 - 9 (2011). Instead, the charitable trusts, may not bring an action to enforce the terms of such a trust. The general rule is that potential trust beneficiaries, in suits involving

which we review de novo. Id. N.H. 308, 311 (2014). The issue of standing is, ther efore, a question of law, only their legal effect stands in dispute. See Appeal of N.H. Right to Life, 1 p. 6 66 403 - 04 (199 1). Nonetheless, in this case, the material facts are not disputed; to claim relief.” Ossipee Auto Parts v. Ossipee Planning B oar d, 134 N.H. 401, based on the facts, whether the plaintiff has sufficiently demonstrated his right must look beyond the plaintiff’s unsubstantiated allegations and determine, motion to dismiss “challenges the plaintiff’s standing to sue, the trial court the challenge to Second Church’s standing as a motion to dismiss. When a 1 p. 7 7

special interest standing doctrine. See N.H. Right to Life v. Dir., N.H. We look to other jurisdictions for guidance on the application of the

applied the Blasko test. just outco me. The DCT argues that the trial court properly adopted and determining that the flexibility of the Blasko test better suits the pursuit of a 201 p. 7 7). The trial court considered this test but applied the Blasko test upon Nonprofit Organizations § 6.05 (Tent. Draft No. 2, 2017) (a pproved May 22, demonstrate special interest standing. See Restatement of the Law Charitable to the Blasko factors but requires a private party to satisfy all of the factors to approved by the American Law Institute (ALI), that proposes five factors similar The trustees advocate for a more stringent test, which follow s the test

Blasko, supra at 61. one factor by itself is sufficient to conclude that it has a special interest. See Blasko five - factor test. Second Church further argues that the presence of any doctrine. Second Church argues that the trial court correctly adopted the matters involving charitable trusts. We must next determine how to apply this Accordingly, we recognize the doctrine of special interest standing in

special interest in the charita ble disposition.”). may be maintained by. . . the state attorney general, or by a person having a (“[A] petition requesting a court to enforce a charitable trust or to apply cy pres interests.” (emphasis added)); see also Unif. Trust Code, supra § 413, C omment general or persons with special interest s to enforce either the trust or their grant of standing to the settlor does not negate the right of the state attorney interest in the charity. See Un if. Trust Code § 405, C omment (2006) (“The contemplate that certain others may have standing based upon their special Ne w Hampshire Trust Code is based, see RSA ch. 564 - B (200 p. 7 7 & Supp. 2018), added). Moreover, t he comments to the Uniform Trust Code, upon which the maintai n a proceeding to enforce the trust.” RSA 564 - B:4 - 405(c) (e mphasis a charitable trust or the director of charitable trusts, among others, may also implicitly allow s special interest standing by providing that “[t]he settlor of trust as a whole.” Concord Nat. Bank, 101 N.H. at 419. RSA 564 - B:4 - 405(c) their views particularly where they are acting for the benefit of th e charitable this [representation] does not preclude other interested parties from presenting represents the public in the enforcement and supervision of charitable trusts, instance, we have previously noted that “[w]hile the Attorney General. . . standing upon a third party if it establishes that it has a special interest. For charitable trust has standing, our law supports the concept of conferring Although we have yet to determine whether a potential beneficiary of a

§ 94 cmt. g at p. 8 8 - 9. dissolution of the charitable corporation); Restatement (Third) of Trusts, supra they were a well - defined class of potential beneficiaries challenging the Gravure, 4 p. 7 79 N.E.2d at 75 5 - 5 6 (concluding that plaintiffs had standing where 8

determine special interest standing in the context of charitable trust matters, Accordingly, because of the various interests that must be considered to designed to protect. See Petition of Lath, 169 N.H. 616, 620 (2017). whether the party suffered a le gal injury against which the law or policy was evaluating whether a party has standing to sue, we generally focus up on so me factors may carry more weight than others and, in New Hampshire, when reach a decision.” Blasko, supra at 61. Depending upon the circumstances, elements is present, then a court can balance them against one another an d special interest in a charity,” the article notes that, “[i]f a combination of any one . . . factor[] by itself can lead a court to decide that the plaintiff has a consider a variety of factors. Although Blasko suggests that “[t]he presence of Blasko test is preferable because it provides a court with the flexibility to special interest standing determination, w e agree with the trial court that t he After review of the factors that other jurisdictions con sider relevant to a

identifiable, and present claim to any benefits” from the trust). not establish standing when they failed to meet the burden of “showing a clear, entitled.” Id. at p. 8 84 - 85 (quot ation omitted) (concluding that the plaintiffs could that is not merely the benefit to which members of the public in general are establish standing if he or she “is entitled to receive a benefit under the trust re l. Nixo n, 96 S.W.3d at 84. The court also acknowledged that a person may if the person is a member of a small class of identifiable beneficiaries.” State ex standing if he or she is entitled to a preference under the terms of the trust or Supreme Court of Missouri likewise recognized that “[a] person. . . may have from the manner in which the trust had been administered in the past”). Th e standing to challenge the trustees’ decision to put into effect a “major change women, who are eligible potential residents of a Trust - operated home, had Hooker, 579 A.2d at 614, 616 - 17 (concluding that the class of elderly, indigent trustees’ acts in deciding whether to apply the special interest exception. considered the nature of the class and the nature of the challenge to the Similarly, i n Hooker, the District of Columbia Court of Appeals

had standing. Id. to the ongoing administration of the corporation, to conclude that the plaintiffs they were challenging the dissolution of the charitable corporation, as opposed the court focused on the well - defined class of beneficiaries and the fact that funds and could maintain a suit. Alco Gravure, 47 p. 9 9 N.E.2d at 75 5 - 5 6. T he re, factors to determine whether the plaintiffs had a “special interest” in charitable Gravure, the New York Court of Appeals considered similar, albeit fewer, Found ation v. Lincoln, 91 P.3d 1019, 1026 (Ariz. Ct. App. 2004). In Alco effectiveness of attorney general enforcement of the trust. S c halkenbach relationship to the trust, the nature of the remedy requested, and the by Blasko, giving speci al emphasis to the nature of the benefitted class and its Appeals adopted a modified version of the five - factor balancing test described other jurisdictions interpreting similar acts for guidance). The Arizona Court of Charitable Trusts Unit, 169 N.H. 95, 103 (2016) (looking to the decisions of 9

Foundation, the appellants alleged that the Foundation had been circumstances. S c halkenbach Found ation, p. 9 91 P.3d at 1027. I n S c halkenbach We find S c halkenbach Found ation to be instructive under the se

Clause [VIII] [T] rust.” therefore, seeks the “relief of having an independent trustee appointed to the Church when distributing the Clause VIII trust assets. Second Church, among other things, that the trustees have improper ly favored the Mother board of directors of the Mother Church. Furthermore, Second Church alleges, an embedded conflict due to their dual role as trustees and members of the Second Church alleges that the trustees engaged in self - dealing and have

relation to the nature of the alleged bad acts. 166 N.H. 737, 740 (2014). Accordingly, we examine the requested remedy in acts is sufficient, by itself, to constitute reversible error. See Gallo v. Traina, not demonstrated that the trial court’s failure to consider the extraordinary novo review, we consider them now, and we conclude that Second Church has considered the extraordinary nature of the ba d acts, because, upon our de To begin, we need not decide whether the trial court should have

17; Alco Gravure, 47 p. 9 9 N.E.2d at 755. plaintiffs are more likely to establish standing. See Hooker, 579 A.2d at 616 facility created by the trust, and the plaintiffs seek t o stop this action, then the the charitable bequest by dissolving the nonprofit corporation or closing the Foundation, 91 P.3d at 1027 - 28. When trustees seek to fundamentally change it is likely to weigh aga inst a finding of standing. See Schalkenbach requested remedy could be “highly intrusive in the administration of the trust,” the nature and extent of the remedy requested.” Blasko, supra at 62. When a Blasko recognized that “courts seem to be influenced from the outset by

trustees are extraordinary while the requested remedy is not. Second Church; and (2) failing to recognize that the bad acts committed by the requested relief, rather than the extraordinary nature of the acts alleged by Second Church argues that the trial court erred by: (1) focusing on the the DCT’s judgment, and this disagreement is not sufficient to justify standing. The trial court therefore determined that Second Church merely disagreed with thorough amicus submissions that the Court assumes the DCT ha s reviewed.” orders and suggests remedies despite Second Church’s “informative and for an independent trustee, among other remedies, seeks to undo prior court As to the first factor, th e trial court found that Second Church’s request

New Hampshire law. We thus address each factor in turn. we conclude that a balancing test of all five Blasko factors best comports with p. 10 10

However, as the DCT counters, Second Church fails to consider the 1993 order when they distributed the Clause VIII funds solely to the Mother Church. Second Church specifically contends that the trustees acted in bad faith

withstanding a motion to dismiss when alleging fraud). Britton Const r., 163 N.H. 252, 262 - 63 (2012) (quotation omitted) (standard for sufficient for the plaintiff merel y to allege fraud in general terms.” Lamprey v. specifically allege the facts of the defendant’s fraudulent actions. It is not fraud . . . the plaintiff must specify the essential details of the fraud, and element which inf luences their decisions. Blasko, supra at 64. “When alleging discuss when evaluating a plaintiff’s special interest, but it is nevertheless an fraud or other deliberate misconduct is not a factor which courts necessarily trustees acted in bad faith is substantial. Blasko notes that the presence of As to the second factor, Second Church argues that the evidence that the

under these circumstances. Accordingly, this factor weighs against standing. bad acts, the appointment of an independent trustee would be unnecessary to church repair.” Therefore, in relation to the nature of the trustees ’ alleged 2018 order also partially amended the 1993 order “to the extent it gave priority the DCT a schedule of recipients of the Clause VIII distributions. The March addressed this conflict, including, inter alia, requiring the trustees to furnish to acknowledged the embedded conflict and imposed certain conditions that alleged bad acts. Notably, in its March 2018 order, the trial court circumstances because the trial court has already taken steps to ad dress the Moreover, Second Church’s requested remedy is unnecessary under the

funds even after the appointment of an independent trustee. disappointed beneficia ries that would still be concerned with the distribution of c ould expose t he charity to vexatious litigation by Second Church or other trust and the ongoi ng administration of the trust. Consequently, this remedy distribution of funds, this request would influence the daily operations of the independent trustee to oversee the administration of the trust, including the Similarly, here, because Second Church seeks the appointment of an

beneficiaries.” Id. at p. 10 102 8. Foundation t o further litigation by other potential or disappointed “highly intrusive in the administration of the trust, which could open the court concluded that the remedies that the appellants wished to impose were interested in carrying out the terms of the charitable trust.” Id. at 1021. The other things, to “replace the Foundation’s officers and directors wi th persons Foundation. Id. at 1027 - 28. The appellants specifically requested, among appellant s ’ participation in and influence of the daily operations of the which the court found implied a request to remedy the situation by the systematically diverting funds from their approved purpose to improper uses, p. 11 11

standing. insufficient to demonstrate bad faith that weighs in favor of granting it order, and t he trustees failed to have independent audits of the accounts ― are trustees failed to restore the priorities of the Clause VIII Trust after the 1993 mismanagement ― that the Mother Church received all distributions, the weigh in favor of standing. Moreover, Second Church’s allegations of that the trustees’ alleged mismanagement demonstrate s bad faith sufficient to Green Charitable Trust does not provide suppor t for Second Church’s assertion challenged the actions of the trustees. Id. at 49 4 - 9 5. Thus, the reasoning in named charitable trust beneficiaries together with the attorney general Church is a potential beneficiary, whereas, in Green Charitable Trust, the standing was not at issue in Green Charitable Trust. Second, h ere Second Green Charitable Trust is inapposite to the circumstances here. First,

property. Id. at 497, 504. having a conflict of interest in representing both the buyer and seller of the fiduciary duty to the beneficiaries by mismanaging the sale of the property and 06. The court upheld the trial court’s finding t hat the trustees violated their by the charitable trust. Green Charitable Trust, 431 N.W.2d at 49 4 - 9 5, 505 the trustees alleging that the trustees mismanaged the sale of property owned of a charitable trust and the state attorney general brought petitions against is sufficient to confer standing. In Green Charitable Trust, named beneficiaries N.W.2d 492 (Mich. Ct. App. 1988), to argue that the trustees’ mismanagement Second Church further relies upon Matter of Green Charitable Trust, 431

and that we need not accept allegations that are mere conclusions of law). motion to dismiss involves testing the facts alleged against the applicable law, See Lamprey, 163 N.H. at 256 (explaining that the threshold inquiry on a merely because of an embedded conflicting fiduciary obli gation is insufficient. Blasko, supra at 64 - 65. T he assertion that the conduct represented bad faith amounts to bad faith or fraud that directly injures Second Church. See Second Church ’s allegations do not demonstrate that this conduct

bad faith. We agree. Second Church’s allegations were in sufficient to demonstrate outright fraud or so, the trustees committed misconduct. H owever, the court further found that implicitly approve d by the court. The trial court acknowledged that, by doing the accounts were accepted for several years by the then - DCT and were conduct represented a clear example of bad faith. T he trial court found that financial statements and, given the existence of the embedded conflict, this accounts, the trustees submitted non - independently prepar ed una udited that after being ordered by the trial court to submit independent audits on the income primarily to repair the M other C hurch. Second Church also asserts which required the trustees to m ake distributions of the Clause VIII T rust’s p. 12 12

fiducia ry obligations. distributions and review the trustees’ resolution regarding the conflicting while also asserting a plan to, inter alia, review the trustees’ process for making Second Church, he recognized the “embedded conflicting fiduciary obligations,” concerns. In addition, in the DCT’s memorandum concerning the st anding of 2016 and that the two parties then proceeded to work together to resolve those acknowledged that the DCT had certain objections to the accounts filed in effect of that conflict. For instance, d uring a motions hearing, the trustees embedded conflict with the trustees, and suggested measures to mitigate the dispute, the DCT ha s been an active participant, has acknowledged the However, the record also demonstrates that during the pendency of the present DCT’s performance of his duties has been mixed and arguably deficient. oversight. As the trial court noted, during the long history of the trusts, the Church.” We disagree with Second Church’s characterization of the DCT’s as the trustees diverted “some $26 million in funds to their preferred Mother th e 1993 order that “turned the T rust priorities upside down,” and sat idly by exclusive control of the conflicted . . . trustees,” participated in the crafting of Second Church alleges that the DCT allowed the trust to “fall into the

thus, this factor weighed against a finding of special interest standing). lack of resources and the re was no evidence of neglect of the public interest; 1028 (attorney general’s decision not to enforce the trust was not influenced by ineffectiveness, or lack of resources. Schalkenbach Found ation, 91 P.3d at the t rust or whether the lack of enforcement is due to a conflict of interest, Under this factor, w e consider whether the attorney general is able to enforce general’s role to seek enforcement of charitable fiduciary duties.” Id. at 70. will take a dim view of private parties attempting to step into the attorney the attorney general is heavily involved in charities regulation, cou rts generally a court’s decision to grant or deny standing.” Blasko, supra at 67. “[W]here nature and level of the attorney general’s involvement can profoundly influence RSA 564 - B:4 - 405(c). When assessing this factor under the Blasko test, “the public and potential beneficiaries of New Hampshire charitable t rusts. See As we previously discussed, the DCT is empowered to represent the

con sider when deciding whether to grant special interest standing. further contend that this finding is the most important Blasko factor to DCT has been available and effective in enforcing the trusts. The trustees policing the trustees’ misconduct. The trustees disagree and argue that the Second Church next argues that the DCT has not been effective in

standing. that this factor is neutral and neither weighs against n or in favor of conferring they fail to demonstrate fraud o r bad faith. T hus, we agree with the trial court In sum, while Second Church’s allegation s may demonstrate misconduct, p. 13 13

January 2017 alerting the DCT of potential mismanagement of trust assets, To support this contention, Second Church asserts that it wrote a letter in the administration of the Clause [VIII] T rust for the DCT to effectively police.” taken by the . . . T rustees, it may be that there are simply too many aspects of Second Church also alleges that “[g]iven the number of questionable acts

trustees’ actions and the trustees’ relationship with the DCT. receiv ed from the DCT as factual support for its allegations regarding the Church ’s pleadings to the trial court indicate that it relied upon documents it documents and information that the DCT does not have. In fact, Second the DCT. Moreover, Second Church does not allege that it has access to also how any “familiar[ity]” with the trusts places it in a better position than Church do es not allege or explain, not only how it is familiar with the trust, but Christian Science Publishing Society, and the Clause VIII T rust, Second “extensively familiar” with the relationships among the Mother Church, the enforcement of the trust. Despite Second Church’s assertion that it is better suited or more qualified than the attorney g eneral to ensure the proper the administration of the trust. Second Church fail s to demonstrate that it is record demonstrates that the attorney general is actively involved in overseeing wrong test when determining wh ether to take legal action, while here, the beneficiary. See id. at 934. Second, the attorney general in Holt applied the Holt were minority trustees, whereas here, the appellant is a potential Second Church’s reliance on Holt is misplaced. First, the plaintiffs in

in any manner that was not detrimental to the public interest. Id. at 936. could only be used for the purposes for which they were received in trust, not wrong test in deciding not to take legal action because the assets of the college impact.” Id. at 935 - 36. The court held that the attorney g eneral applied the conduct or to be sufficiently familiar with the situation to appreciate its attorney general “may not be in a position to become aware of wrongful charitable purpose, which, as t he court noted, illustrated the concern that the not to have information that the trust assets were being diverted from their by its office to prevent such changes. Id. The attorney general also claimed would not be detrimental to the public interest and did not warrant legal action answer concluding that the suggested changes to the operation of the college charitable purposes of the college. Id. at 934. The attorney general filed an majority trustees alleging that the defendant trustees acted contrary to the Holt, minority trustees brought suit against the charitable corporatio n and the other suitable means of enforcement are available.” Holt, 394 P.2d at 93 6. In charitable trusts stands only to benefit if in addition to the Attorney General 932 (Cal. 1964), in which the court noted that “[t]he administration of reasoning in Holt v. College of Osteopathic Physicians and Surgeons, 394 P.2d perhaps only, w ay to protect the T rust assets.” Second Church relies upon the Second Church to intervene as a party familiar with the t rusts “is the best, and addressing the embedded conflict with the trustees and, therefore, allowing Nonetheless, Second Church maintains that the DCT is ineffective in p. 14 14

plaintiffs were entitled to a preference in the distribution of the defendants’ assist employees of the founder’s corporations and their families.”). The Gravure, 479 N.E.2d at 753 - 54 (“The Foundation’s primary purpose was . . . to plaintiff ― constituted a class of potential benefi ciaries of the Foundation. Alco beneficiaries of the Foundation, and two individual employees of the corporate the plaintiffs ― a corporate employer whose employees were intended the building injure d them in particular. Id. at 5 92. Similarly, i n Alco Gravure, branch received a particular benefit from this local branch and the closing of the District of Columbia Court of Appeals concluded that the members of the 591 (D.C. 1984). In holding that the plaintiffs ha d special interest standing, and by closing it. Y.M.C.A. of City of Washington v. Covington, 484 A.2d 589, breached a charitable trust by allowing the local branch building to deteriorate w here members of a local branch brought suit claiming that the YMCA For instance, Second Church relies upon Y.M.C.A. of City of Washington, courts have “granted special interest standing to more attenuated persons.” Mother Church. Second Church relies upon several cases to argue that other Christian Science churches, that is defined by its unique connection to the Second Church contends that it is a branch church, one of 1,400

the charity.” Blasko, supra at 70. enforcement of the charitable obligations at issue to claim a ‘special interest’ in direct and defined interest, distinct from that of th e general public, in the limited in number.” Hooker, 579 A.2d at 6 p. 14 14. “[A] plaintiff should have a standing where the class of entities is “sharply defined and its members are bears a special relationship to the charity. Courts have found special interest Second Church argues that it is part of a defined class of entities that

its concerns with the DCT. court’s encouragement of Second Church to continue to share information and favor of granting standing to Second Church. In addition, we iterate the trial Thus, we agree with the trial court that this factor does not weigh in

genera l is not involved or is ineffective. is not sufficient to support Second Church’s allegation that the attorney agree with Second Church to seek the appointment of an independent trustee recipients’ and not affiliated with the Mother Church.” T he DCT’s reluctance to affidavit(s), under oath, that these distributees are i n fact ‘third party accounts, a schedule of recipients of Clause VIII distributions and provide requiring the trustees to submit to the DCT “along with the annual audited March 2018 order als o ensures the continued involvement of the DCT by matter and has taken steps to address the embedded conflict. The trial court’s However, as mentioned above, the DCT has been actively involved in this and Second Church believes that the DCT has not acted on that information. p. 15 15

rights, duties, and powers of the attor ney general in connection with the RSA 7:20, the DCT “shall have and exercise all the common law and statutory been encouraged to share its perspective with the DCT. Importantly, under and is activ ely involved in the oversight of the trust, and Second Church has determination of standing.” We agree. The DCT has acknowledged the conflict branch church and knowledge of the religion . . . [to] weigh [] heavily in its positioned to monitor and enforce the terms of the Trusts’ due to its status as a embedded conflict,” it did not find Second Church’s claim that it “is ‘well The trial court found that although it remain ed “concerned about the

w hic h would otherwise go uncorrected.” Blasko, supra at 75. applying to “those cases where there seem ed to have been an egregious wrong standing. Blasko describes this factor as somewhat of a catch - all factor, Second Church next argues that it is socially desirable to grant it

against standing. for the special interest standing it seeks.” Accordingly, this factor weighs that the appointment of an independent trustee “will likely eliminate the need persuaded by Second Church’s attempt to alleviate this concern by arguing trial court that “the potential for vexatious lit igation is heightened.” We are not B ecause Second Church is not in a small, well - defined class, we agree with the beneficiaries. Thus, the class of potential beneficiaries is not sharply defined. is challenging ongoing administra tion that could impact all of the potential Second Church is not alleging a harm directly related to its church, but rather was intended to benefit more than just the branch churches. Moreover, distribut ion of the income is limited to a small, identifiable class. The trust Christian Science. This broad language dispels any notion that the T rust is to be utilized for the purpose of promoting and extending the religion of to demonstrate that it is in such a class. The income from the Clause VIII charitable trust and corporation than the general public. Second Church fails a sharply defined set of potential beneficiaries with a greater interest in the The cases relied upon by Second Church concern plaintiffs that comprise

pr eferred beneficiaries of the funds.” Id. corporation and the complete elimination of the individual plaintiffs’ status as ongoing administration of a charitable corporation, but the dissolution of that Specifically, the court concluded that “the present action concerns not the standing did not apply to the circumstances in that cas e. Id. at 756. also granted standing because it found that the policy reasons for limiting preference in the distribution of the defendants ’ funds. Id. at 755. The court because the class of beneficiar ies was both well - defined and entitled to a at 75 4 - 56. The court found that the plaintiffs had special interest standing complete elimination of their status as preferred beneficiaries of the funds. Id. funds and were therefore challenging the dissolution of the Foundation and the p. 16 16

compel discovery and, thus, did not raise this argument before the trial court. Second Church never sought the trial court’s permission or authorization to either engage in or Second Church sought additional time to obtain discovery from the DCT and the Mother Church. We observe that the material facts are largely undisputed. In addition, the record indicates that 2

concurred. LYNN, C.J., and HICKS, BASSETT, and HANTZ MARCONI, JJ.,

to file as amicus curiae with the trial court. share its perspective and concerns with the DCT, and, when appropriate, seek We reiterate the trial court’s sentiment that Second Church is encouraged to address its argument re questing the appointment of an independent trustee. Because we conclude that Second Church lacks standing, we need not

did not provide the trial court with an opportunity to address them. Accordingly, we decline to address these arguments because Second Church hearing or argued to the trial court that it erred by not holding one. See id. is no evidence in the record that Second Church requested an evidentiary Energy Co. v. Provider Power, LLC, 170 N.H. 569, 574 (2018). Similarly, there to the trial court about its inabilit y to obtain discovery. See Halifax - American 2 standard when it applied the Blasko factors or that Second Church complained does not show either that the trial court used a preponderance of the evidence discovery an d without holding an evidentiary hearing. However, the record Blasko factor by a preponderance of the evidence” without the benefit of asserts that the trial court erred by “effectively” requiring that it “prove each when it denied it standing on a limited record. Specifically, Second Church Finally, Second Church argues, in passing, that the trial court erred

B. Procedural Issue

appointment of an independent trustee to the trust. the Clause VIII Trust sufficient to grant it standing to petition for the that Second Church has failed to demonstrate that it has a special interest in Consequently, after considering all of the factors together, we conclude

RSA 7:19 -:32 - a (2013 & Supp. 2018). supervision, administration, and enforcement of charitable trusts.” See also