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Stanley Swenson, As Trustee of Regency Trust v. United States of America

January 11, 2013

STANLEY SWENSON, AS TRUSTEE OF REGENCY TRUST, BERRYVALE TRUST, AND HOTLUM TRUST PLAINTIFF,
v.
UNITED STATES OF AMERICA, DEFENDANT.



The opinion of the court was delivered by: Craig M. Kellison United States Magistrate Judge

FINDINGS AND RECOMMENDATIONS

Plaintiff, proceeding in propria persona on behalf of three trusts, brings this civil action relating to property titles. Pending before the court is defendant's motion to dismiss (Doc. 5). Plaintiff filed a timely opposition (Doc. 7). A hearing on the motion was held on January 9, 2012, before the undersigned in Redding, California. Defense counsel G. Patrick Jennings appeared telephonically; Plaintiff appeared in person.

I. Background

Plaintiff, proceeding pro se, is attempting to represent three trusts in this action: Regency Trust, Berryvale Trust, and Hotlum Trust. He alleges in the complaint that he is the successor trustee for each of the three trusts. The action challenges a tax lien the government is attempting to enforce and reduce to judgment against the trusts.*fn1 Plaintiff states he is seeking a release of the liens and levies the IRS has recorded against the trusts.

In the complaint, plaintiff alleges he is the successor trustee for all three trusts, which he states are irrevocable. The tax liens at issue have been attached to properties plaintiff alleges are owned by the trusts, while the taxes are owed by Richard and Diane Shearer who had owned the properties, but transferred the properties into the trusts prior to the tax liabilities. Thus, plaintiff contends, there is no basis for the lien attachment against the properties. Plaintiff acknowledges the taxes are owed by the Shearers, but not the trusts.

II. Motion to Dismiss

Defendant brings this motion to dismiss on the grounds that plaintiff, who is not an attorney, cannot represent the trusts in this action. The motion is based on 28 U.S.C. § 1654, which allows parties to appear in pro per, but only when representing themselves alone. Defendant contends that plaintiff is not representing himself but the trusts in this action, and he should therefore not be allowed to proceed. In addition, defendant argues this case should be dismissed because the same questions of fact and law will be resolved in the parallel case.

In opposition to the motion, plaintiff acknowledges that he is not an attorney, but argues he is representing his own personal interests and does not lack standing. He argues that an individual trustee representing a trust has a beneficial interest and is distinguishable from an individual representing an association or an institutional or distant trustee representing a trust.

III. Discussion

28 U.S.C. § 1654 provides:

In all courts of the United States the parties may plead and conduct their own cases personally or by counsel as, by the rules of such courts, respectively, are permitted to manage and conduct causes therein.

Defendant cites two main cases in support of their position that plaintiff cannot represent the trusts' interests pro se: Rowland v. California Men's Colony, 506 U.S. 194, 202 (1993) and C.E. Pope Equity Trust v. United States, 818 F.2d 696, 697 (9th Cir. 1987).

The issues addressed in the Rowland case are not similar to those present here. In Rowland, the United States Supreme Court found only natural persons could proceed in forma pauperis. In so deciding, however, the Court discussed the issue presented here, whether an artificial entity (such as a corporation or association) could appear in a federal court without licensed counsel. The Court acknowledged that "the lower courts have uniformly held that 28 U.S.C. § 1654, providing that 'parties may plead and conduct their own cases personally or by counsel,' does not allow corporations, partnerships, or associations to appear in federal court otherwise than through a licensed attorney." Rowland, 506 U.S. at 202 (citations omitted).

The issues addressed in C.E. Pope Equity Trust are equivalent to those raised here, whether the trustee of a trust may proceed pro se on behalf of the trust. In that case, the Ninth Circuit clarified that "[a]lthough a non-attorney may appear in propria persona in his own behalf, that privilege is personal to him . . . [and he] has no authority to appear as an attorney for others than himself." 818 F.2d at 697 (internal citations and quotations omitted). As is the case here, in C.E. Pope Equity Trust, the trustee, acting in his capacity as trustee, is a fiduciary responsible for the orderly administration of assets. The Ninth Circuit noted the record did not identify the trust's beneficiaries, nor was there anything in the record to indicate that the trustee was the actual beneficial owner of the claims being asserted by the trusts. Thus, the trustee was not "a 'party' conducting his 'own case personally' within the meaning of Section 1654." Id. at 697-98. Similarly, in the instant case, there is nothing in the complaint indicating that plaintiff is a beneficiary as well as the trustee. As plaintiff is representing the interests of the trust, and thus the beneficiaries of the trust, he cannot be viewed as a ...


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