JAMES ADAM SLAVENS, ALEXA SLAVENS, and TANNER SLAVENS, TWIN G HOLDINGS, LLC, and derivatively, THE ESTATE OF JAMES KENNETH SLAVENS, Plaintiffs-Respondents,
MELANIE SLAVENS, both personally and as administrator of THE ESTATE OF JAMES KENNETH SLAVENS, Defendants-Appellants.
Opinion No. 124
from the District Court of the Seventh Judicial District of
the State of Idaho, Bonneville County. Hon. Jon J.
Shindurling, District Judge.
judgment of the district court is vacated and the case is
remanded for further proceedings.
Parsons, Smith, Stone, Loveland & Shirley, Burley, for
appellants. William A. Parsons and Randy Stone argued.
Simmons, JD LLM, PC, Idaho Falls, for respondents.
Slavens, both personally and as administrator of the Estate
of James Kenneth Slavens, brings this appeal from the
Bonneville County district court. After the death of James
Kenneth Slavens (Jim), James Adam Slavens, Alexa Slavens,
Tanner Slavens, Twin G Holdings, LLC, and Jim's Estate
(Respondents) sought a declaratory judgment as to the
parties' rights in Twin G Holdings, LLC (Twin G), which
Jim formed before he died. The district court determined that
Melanie had no rights in Twin G and entered judgment that:
(1) Jim's three oldest children-James Adam, Alexa, and
Tanner (the Eldest Children)-each own 33% of Twin G; (2) the
Eldest Children are Twin G's sole members; (3) James Adam
is Twin G's sole manager; and (4) Melanie was never a
member or manager of Twin G. We vacate and remand.
FACTUAL AND PROCEDURAL BACKGROUND
December 12, 2012, Jim was killed in a fatal car wreck. Jim
predeceased his wife (Melanie) and five children. Those five
children consisted of twins (Gracie and Grant) Jim had with
Melanie, and the Eldest Children, who were from Jim's
years before Jim died, he formed the Idaho LLC-Twin G-that is
the subject of this appeal. On June 22, 2005, Jim formed Twin
G for asset protection purposes. Jim's concerns about
asset protection arose after a buyer to whom Jim had sold a
business defaulted on debts owed to Jim and other creditors.
When those creditors began pursuing Jim, he formed Twin G to
shield his assets from a judgment. Twin G was named after Jim
and Melanie's twins, Gracie and Grant. Twin G's
Articles of Organization list Jim as Twin G's managing
member. Twin G's Operating Agreement designates Jim and
Johnny Slavens, Jim's brother, as members, with Jim
owning 1% and Johnny owning the remaining 99%. Johnny held a
largely passive role in Twin G and testified he held the 99%
ownership interest in Twin G for Jim's benefit until
Jim's death and then for the Eldest Children's
relationship with Johnny soured when real property recorded
in Johnny's name became involved in a lawsuit in spring
2011. Although Johnny had deeded the property to Jim, Jim
never recorded the deed. Therefore, Johnny blamed Jim for the
lawsuit. After Jim settled the lawsuit, Johnny told Jim he
"need[ed] to absolutely avoid th[o]se types of
situations going forward" and expressed hesitation about
"allow[ing] someone else to use [Johnny's] name on
things for which [he] d[id] not fully understand the
to that end, in April 2011, Jim took efforts to remove Johnny
from Twin G. Jim first sent to Johnny an "Addendum"
to Twin G on April 21, 2011. If signed, the Addendum
purported to transfer Johnny's ownership interest. The
Addendum recited that Johnny "desires to have no
interest in Twin G" and, therefore, "has agreed to
convey his entire interest to James K. Slavens and Melanie
Slavens in such a way that they will share an equal interest
in the property." When Jim sent the Addendum to Johnny,
Jim explained he was unsure whether the Addendum was the
proper way to transfer Johnny's ownership interest and
requested that Johnny wait to sign it. Johnny never signed
later, Jim sent to Johnny an Amended Certificate of
Organization for Twin G. Jim, who had already filled in the
Amended Certificate, requested Johnny's signature so that
Jim "can get [Johnny] out of [Twin G.]" Whereas the
Addendum indicated Johnny was merely transferring his
ownership interest, the Amended Certificate went further. The
Amended Certificate indicated Johnny was
"[d]elet[ing]" himself as a member, adding Melanie
as a member or manager, and authorizing Jim's ownership
of 75% of Twin G and Melanie's ownership of the remaining
25%. Johnny signed and returned the Amended Certificate to
Jim in April 2011. However, Jim never filed it with the Idaho
Secretary of State. Instead, Jim kept the Amended Certificate
in his personal files for approximately nineteen months. Jim
could have filed the Amended Certificate when filing Twin
G's annual reports in 2011 and 2012, but did not do so.
Jim died without filing the Amended Certificate.
Jim died, Melanie opened a probate proceeding in Utah, where
Jim was domiciled, and was appointed special administrator of
Jim's estate. Melanie then asserted rights in Twin G and
filed the Amended Certificate with the Idaho Secretary of
State. Johnny maintained he still had membership and
ownership rights in Twin G, despite having executed the
Amended Certificate. As Johnny explained, delivery of the
Amended Certificate to Jim was conditional on Jim filing it
with the Idaho Secretary of State, which Jim never did. Thus,
in August 2013, Johnny executed transfer documents purporting
to transfer and assign membership, management, and ownership
rights in Twin G to the Eldest Children.
October 2013, Respondents filed a complaint seeking a
declaratory judgment as to their rights in Twin G. Melanie
moved to dismiss, which the district court denied.
Respondents then moved for partial summary judgment, which
the district court granted. Melanie filed a motion to
reconsider, which the district court denied. Thereafter, the
district court entered a certified judgment under Idaho Rule
of Civil Procedure 54(b). Melanie timely appealed.