Byrnes et al v. American Family Mutual Insurance Company SI

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WO
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF ARIZONA
Timothy R Byrnes, et al.,
Plaintiffs,
v.
American Family Mutual Insurance
Company SI,
Defendant.
No. CV-26-00981-PHX-DWL
ORDER
A matter requiring the Court’s attention is the existence of LD Seven Trust as a
party to this action. Arizona law governs this issue. Irwin Union Collateral Inc. v. Peters
& Burris, LLC, 2009 WL 5184902, *3 (D. Ariz. 2009) (“[S]ince the trust is neither an
individual nor a corporation, the law governing whether the Sass Trust has the capacity to
sue or be sued is governed by Arizona law, the state in which this Court sits.”). In general,
a trust “lack[s] the capacity to sue or be sued under Arizona law.” Id. at *4; see also 76
Am. Jur. 2d Trusts § 601 (“At common law, a trust cannot sue or be sued because it is not
a juristic person. In most jurisdictions, a trust is not an entity separate from its trustees, and
cannot sue or be sued in its own name, and therefore, the trustee, rather than the trust, is
the real party in interest in litigation involving trust property. Because a trust is not a legal
entity, and does not have capacity, any suits involving the trust must be brought by or
against the trustees.”); Matter of Book, 2019 WL 2394259, *2 (Ariz. Ct. App. 2019), review
denied (2019) (unpublished) (“Generally, a common-law trust is not considered a legal
entity capable of suing or being sued; therefore, any suit involving the trust must be brought
Case 2:26-cv-00981-DWL Document 12 Filed 04/23/26 Page 1 of 2

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by or against its trustee.”). A common-law trust cannot sue in its own name—such a suit
must be brought by its trustee.
There is a narrow exception—a business trust may sue and be sued in its own name.
See, e.g., McLeod v. Deutsche Bank Nat’l Tr. Co., 2017 WL 2189498, *3 (Ariz. Ct. App.
2017) (unpublished). Cf. Americold Realty Tr. v. Conagra Foods, Inc., 577 U.S. 378, 383
(2016) (holding Maryland real estate investment trusts to be unincorporated entities that
can sue or be sued in their organizational names). Thus, it is likely that LD Seven Trust
must be dropped as a party to this lawsuit and its trustee added in its place, unless LD Seven
Trust can establish that it qualifies as a business trust under Arizona law.
Accordingly,
IT IS ORDERED that by May 8, 2026, Plaintiffs shall file either (1) an amended
complaint, dropping LD Seven Trust as a party and adding its trustee as a party (in which
case, jurisdictional facts about the trustee must be pleaded) or (2) a memorandum
establishing that LD Seven Trust is a business trust under Arizona law.
Dated this 23rd day of April, 2026.
Case 2:26-cv-00981-DWL Document 12 Filed 04/23/26 Page 2 of 2