Wilson v. Dallas

Robert L. Buchanan, Jr. and Adele J. Pope (“Appellants”), formerly personal representatives for The Estate of James Brown and trustees of The James Brown 2000 Irrevocable Trust, appeal from circuit court orders that (1) approved a settlement agreement pursuant to S.C.Code Ann. § 62-3-1102 (2009) of pending litigation concerning the estate; and (2) removed Appellants from their fiduciary positions and appointed Russell L. Bauknight as personal representative and trustee. We affirm in part, reverse in part, and remand.

I. FACTS

James Brown (“Brown”), a singer and entertainer known as “The Hardest-Working Man in Show Business” and “The Godfather of Soul,” died in Atlanta, Georgia on December 25, 2006. Brown left an estate widely estimated to be worth anywhere from $5 million to over $100 million that is at the heart of this dispute among numerous parties.

By will dated August 1, 2000, Brown devised all of his personal and household effects to six adult named children: Deanna J. Brown Thomas, Yamma N. Brown, Vanisha Brown, Daryl J. Brown, Larry Brown, and Terry Brown. Brown left the remainder of his estate to The James Brown 2000 Irrevocable Trust via a pour-over provision in his will.

Brown created the 2000 Irrevocable Trust under a separate agreement, also dated August 1, 2000, as part of his estate plan to provide financial assistance for the education of his grandchildren and disadvantaged youths. The agreement creating the 2000 Irrevocable Trust includes Schedule A, which indicates Brown placed his long-time residence at Beech Island, Aiken County, and other assets in the trust as part of its initial funding, although the record contains some discrepancies as to the timing of the transfers.

*417Albert H. Dallas, Alfred1 A. Bradley, and David G. Cannon were named as the co-personal representatives of Brown’s estate and as the co-trustees of the 2000 Irrevocable Trust. In the trust document, Brown created an Advisory Board, initially to be comprised of three members, who were to confer with and advise the trustees in a manner consistent with Brown’s objectives for the trust. There were also provisions regarding trustee succession, which required three trustees to serve at all times.

Upon Brown’s death, the principal and income contained in the 2000 Irrevocable Trust, as augmented by Brown’s general estate, was to be divided, by its terms, into two “shares” or subtrusts: (1) The Brown Family Education Trust (“Family Trust”), which was capped in the amount of $2 million for tax purposes and designated for the education of Brown’s grandchildren; and (2) The James Brown “I Feel Good” Trust (“Charitable Trust”), which Brown declared “shall be used solely for the tuition, educational expenses, and financial assistance of ... poor and financially needy children, youth, or young adults (Who are both qualified and deserving) who seek and have need of such assistance to obtain and further their education at the many educational entities and/or institutions available in the States of South Carolina and Georgia.” Thus, Brown’s estate planning documents indicate Brown intended the bulk of his wealth to be used to support the Charitable Trust.

Brown’s will and trust each contained a no-contest clause, which provided that any beneficiary who challenged the will or the 2000 Irrevocable Trust “shall forfeit his or her entire interest thereunder.” Brown noted in both documents that the persons described therein, i.e., the six named children and their legitimate issue, comprised “the entire class ... acknowledge[d] to be [his] heirs and issue.” Brown expressly disavowed any other potential beneficiaries, stating, “I have intentionally failed to provide for any other relatives or other *418persons, whether claiming, or to claim, to be an heir of mine or not.” Brown stated any person not provided for in his will or trust “whether or not claiming to be a beneficiary, party in interest, or otherwise shall not have standing or be qualified to contest, claim an interest in or otherwise dispute the disposition of [his] estate as he herewith disclaims and disinherits any such person.” Brown stated that any challenge by such persons to the disposition of his estate or the validity of the documents would “be considered an affront to [his] wishes,” and “shall be vigorously challenged as such by his fiduciaries.” In the trust agreement, Brown declared that he was not then married and that he did not want the trust estate to ever go to a spouse: “It is the Grantor’s [Brown’s] intention that the trust estate be available only to the beneficiaries and not ... the Grantor’s past or future spouse. The Trustee(s) are directed to enforce this provision.”

Thereafter, on November 27, 2001, Brown and Tommie Rae Hynie (“Tommie Rae”) executed a Prenuptial Agreement in which Tommie Rae acknowledged that she was entering the agreement knowingly and voluntarily and that she had the opportunity to receive the advice of counsel of her own choosing. Tommie Rae waived any right to Brown’s property or the receipt of alimony in the event of a separation or divorce from Brown, and she agreed to waive any claim for an interest in his estate in the event of his death, including the rights to a statutory share of Brown’s estate or to any interest as an omitted spouse.

On December 14, 2001, Brown and Tommie Rae participated in a marriage ceremony in Aiken County. In 2004, Brown brought annulment proceedings against Tommie Rae after discovering that she had participated in a marriage ceremony in Texas in 1997 with another individual, Javed Ahmed. Brown attached documents to his pleadings showing Tommie Rae had not been granted an annulment of the prior marriage until April 15, 2004. Tommie Rae counterclaimed for a divorce from Brown on the ground of physical cruelty, and in his reply, Brown sought genetic testing of a son, respondent “James B.,” born to Tommie Rae on June 11, 2001. The parties dismissed their respective suits in a consent order filed August 16, 2004, in which Tommie Rae agreed to “forever waive any claim of a common law marriage to [Brown], both *419now and in the future.” The parties thereafter had an on-and-off-again relationship up until Brown’s death on December 25, 2006.

In 2007, five of the six adult children Brown named in his will as well as Tommie Rae, all Respondents herein, brought actions to set aside Brown’s will and the 2000 Irrevocable Trust based on undue influence. They alleged Brown’s estate should, instead, pass by the laws of intestate succession. Tommie Rae claimed that she was entitled to an elective share or an omitted spouse’s share of Brown’s estate and that her son, James B. (via a guardian ad litem), was entitled to a share of the estate as an omitted child. The probate court transferred these claims and all filings thereafter to the circuit court.

■ Appellants were initially appointed by the circuit court in March 2007 as Special Administrators with limited duties to oversee the handling of Brown’s estate after petitions were filed by some of Brown’s family members seeking the removal of Dallas, Bradley, and Cannon as personal representatives. The court made the selection after the parties could not agree on who should be appointed. Ultimately, the three original fiduciaries either resigned or were removed from their positions as personal representatives and trustees.2

In November 2007, the circuit court appointed Appellants as the personal representatives for Brown’s estate and as trustees of the 2000 Irrevocable Trust, with full authority as if they had been appointed in the original placement order. The South Carolina Attorney General (“AG”), who had recently intervened in the case on the ground the claims involved a charitable trust, unsuccessfully opposed the appointment of Appellants as fiduciaries.3

*420After ongoing negotiations directed by the AG, the parties entered into a compromise agreement at an informal mediation session on August 10, 2008. The settling parties named in the agreement were Tommie Rae, the children and grandchildren of Brown, and the AG. Appellants contend they did not participate in the discussions or in the agreement as they received no notice of them. The agreement was thereafter submitted to the circuit court for its approval pursuant to S.C.Code Ann. § 62-3-1102 (2009). Appellants were given notice of the agreement and participated in all proceedings related to the court’s consideration of the compromise.

In January 2009, the circuit court appointed Russell L. Bauknight, a certified public accountant, as Special Administrator for Brown’s estate and Special Trustee of the 2000 Irrevocable Trust. Bauknight was appointed, at the Respondents’ suggestion, for the limited purpose of providing input and recommendations to the court regarding the compromise agreement. The circuit court ordered Appellants to continue in their fiduciary capacities at that time, except for the limited duties assigned to Bauknight.

A hearing was conducted over seven days from January to April 2009. At the first hearing date on January 30th, the parties advised the circuit court that Respondent Terry Brown, one of the six children Brown named in his will, had joined in the compromise, so that the agreement now included an addendum. In exchange for his participation, Terry Brown was given “an absolute and superior Right of First Refusal to purchase any and all of the James Brown Assets (whether on an asset or stock basis) to be sold in any Proposed Transfer” for a period of ten years.

The circuit court approved the compromise agreement by order of May 26, 2009, over the objections of Appellants.4 The *421circuit court found the agreement was executed by all persons having beneficial interests that were affected by the compromise, the will and trust controversy was pursued in good faith, and the agreement was fair, equitable, and reasonable.

Under the terms of the agreement brokered by the AG, the parties would jointly seek the removal of Appellants as the personal representatives of Brown’s estate and as trustees of the 2000 Irrevocable Trust. All challenges to the will were to be dismissed, and the settling parties agreed that such contests were brought in good faith and with probable cause. Tommie Rae was recognized as the surviving spouse of Brown, and all children and grandchildren who were parties to the agreement were acknowledged to be Brown’s legitimate issue and heirs without the need for DNA testing to verify their status.

The settling parties agreed to create a new trust called the James Brown Legacy Trust (“Settlement Entity”), which will “receive, hold, manage and be authorized to sell the James Brown Assets.” The trustee and any successor trustee for the Settlement Entity was to be selected solely by the AG. The settling parties who had any intellectual property rights to Brown’s music or persona created under federal copyright laws or laws for heirs agreed to surrender those rights to the Settlement Entity. Tommie Rae waived any spousal rights that she might have and the children waived any rights to Brown’s assets that they might otherwise have beyond any share to be received in the compromise.

A (New) Charitable Trust, similar to the existing Charitable Trust formed from the 2000 Irrevocable Trust, was to be created by the AG with the advice and counsel of the parties. The AG was to have the sole authority to select the managing trustee as well as any successor trustee. An Advisory Board was to be established, whose members would “serve at the pleasure of and on such terms as the [AG] shall decide.” The number of members on the Advisory Board was to be determined by the AG, but would include a member selected by Tommie Rae and one selected by each of Brown’s adult children, and the roles of all members of the board were expressly stated to “be solely advisory.” The (New) Charitable Trust would also have Honorary Family Trustees in a *422number to be decided by the AG and who would serve under the same terms and conditions as the Advisory Board. A trust similar to the Brown Family Education Trust was to be established for the education of the grandchildren and their issue, to be funded with $2 million.

The parties were to divide their distributional interest in the Settlement Entity as follows: a net 47.5% to the (New) Charitable Trust; a net 23.75% to Tommie Rae, which includes any share attributable to her son; and a net 4.79% to each of Brown’s adult children who are settling parties. For voting purposes, however, the (New) Charitable Trust was to retain a 50% voting and control interest in the Settlement Entity, the named adult children were to retain a 25% voting and control interest, and Tommie Rae was to retain a 25% voting and control interest. The parties indicated in their agreement that they intended this to be a binding private agreement, but they also desired court approval of the agreement.

The circuit court approved the compromise agreement and directed Appellants to execute the agreement. At the request of the settling parties, the circuit court appointed Bauknight to have full authority as the personal representative for Brown’s estate and as trustee, and Appellants were removed from those positions.

Appellants appealed these rulings as well as additional, related orders, and the Court of Appeals consolidated the appeals. This Court granted a request for certification by the Court of Appeals pursuant to Rule 204(b), SCACR, and the case was transferred to the Supreme Court.

II. LAW/ANALYSIS

A. Standing

As an initial matter, Respondents assert Appellants do not have standing to pursue this appeal because they have no interest in the subject matter of the litigation, i.e., the will and trust; therefore, the appeal should be dismissed. Specifically, Respondents argue Appellants lack standing to appeal the circuit court’s approval of the settlement agreement and the AG’s involvement since they had no vote or veto power over *423the settlement at the trial level. Respondents further argue Appellants lack standing to appeal their removal as personal representatives and trustees because (1) their failure to adequately brief this point operates as a waiver of the issue; and (2) once the order was issued removing them as fiduciaries, its effect was immediate and their only interest in this matter became a peripheral one pertaining to their claim for fees for the time they acted as fiduciaries.

“Before any action can be maintained, there must exist a justiciable controversy.” Byrd v. Irmo High Sch., 321 S.C. 426, 430, 468 S.E.2d 861, 864 (1996). Justiciability encompasses several doctrines, including ripeness, mootness, and standing. Jackson v. State, 331 S.C. 486, 491 n. 2, 489 S.E.2d 915, 917 n. 2 (1997) (citation omitted). “Standing refers to a party’s right to make a legal claim or seek judicial enforcement of a duty or right.” Michael P. v. Greenville County Dep't of Soc. Servs., 385 S.C. 407, 415, 684 S.E.2d 211, 215 (Ct.App.2009). “Generally, to have standing, a litigant must have a personal stake in the subject matter of the litigation.” Id. at 415-16, 684 S.E.2d at 215.

As noted by Appellants, there was no specific ruling discussing Appellants’ standing in the circuit court’s order of May 2009, and the matter was not raised in a Rule 59 motion. Although the circuit court did refer to standing, it was in the context of discussing authority from another jurisdiction when the circuit court reviewed the facts of that case. This Court has previously declined to consider standing where the matter was not both raised to and ruled upon by the trial court, and it is questionable whether the issue was properly preserved here, although it was briefed. See, e.g., James v. Anne’s Inc., 390 S.C. 188, 193, 701 S.E.2d 730, 732-33 (2010) (observing this Court has the inherent authority to consider justiciability, but when a party raises the issue, our courts have applied error preservation principles and have held the issue was not preserved where the trial court did not first rule on the issue).

Assuming, arguendo, that the circuit court impliedly ruled on the issue, we conclude Appellants have standing. Appellants were properly made parties to the action and were allowed to set forth specific challenges to the proposed compromise agreement for the circuit court’s consideration under *424S.C.Code Ann. § 62-3-1102 (2009). We agree with Appellants that they have standing based on the explicit terms of the trust agreement, which conferred upon the trustees the authority to handle claims for or against the trust estate (including the authority to mediate or compromise claims), and based on their official fiduciary capacities pursuant to state law.5 See S.C.Code Ann. § 62-7-405(c) (2009) (“The settlor of a charitable trust, the trustee, and the Attorney General, among others may maintain a proceeding to enforce the trust.”); P.H. Vartanian, Annotation, Right of Trustee of Express Trust to Appeal from Order or Decree Not Affecting His Own Personal Interest, 6 A.L.R.2d 147, 152 (1949 & Later Case Service 1997) (stating where an order threatens the existence of a trust, prevents a trustee from performing his duties, or depletes the trust fund with unreasonable claims, the trustee may, in his fiduciary or representative capacity, appeal therefrom as an aggrieved party); see also Columbia Union Nat’l Bank & Trust Co. v. Bundschu, 641 S.W.2d 864, 879 n. 10 (Mo.Ct.App.1982) (stating “where a trustee is affected by a judgment in his official capacity, he is aggrieved and may appeal”); In Re Estate of Birch, 50 A.D.2d 475, 378 N.Y.S.2d 792, 797 (1976) (holding “that the Attorney General and the trustee had standing” because “[t]he trustee has a legal obligation to defend the trust ... [and] [t]he Attorney General, likewise, has a duty to represent the beneficiaries where there are dispositions for religious and charitable purposes”); In re Crawford’s Estate, 340 Pa. 187, 16 A.2d 521 (1940) (involving an appeal from an order removing the appellant as a co-trustee).

B. Court’s Approval of Compromise Agreement

In their appeal, Appellants contend the compromise agreement was not eligible for court consideration under section 62-3-1102 because the trust did not agree to it and the AG had no authority to speak for the trust. Appellants assert a compromise can be considered under the statute only if all holders of beneficial interests agree to it, and the 2000 Irrevocable Trust, which was entitled to the residue of Brown’s estate, was the *425chief holder of a beneficial interest in the estate. The trust, however, was not represented in the settlement and did not agree to reducing its share of Brown’s estate by half, so there was no compromise agreement for the circuit court to consider.

Appellants argue the AG’s authority to enforce a charitable trust does not give him the authority to direct the settlement of an estate dispute, remove existing trustees, and administer a new trust with the AG at the helm. Appellants argue the AG effectively placed himself in control of most of Brown’s assets by securing sole authority to select a managing trustee of the new entity, and then proceeded to give away over half of the estate to disinherited family members and purported family members, all in contravention of Brown’s express wishes that the bulk of his wealth be used for the charitable purpose of educating disadvantaged youths.

Appellants further assert that, even if the agreement were eligible for court consideration, the agreement did not meet the statutory standard necessary to nullify Brown’s estate plan because (1) it was not a compromise of a bona fide (good faith) challenge to Brown’s will, and (2) it was unjust and unreasonable.

Upon appeal, “[t]he question [for an appellate court] is did the [ruling] court abuse its discretion in approving the compromise?” In re Estate of Horton, 11 Cal.App.3d 680, 90 Cal.Rptr. 66, 68-69 (1970). An abuse of discretion occurs when a court’s order is controlled by an error of law or there is no evidentiary support for the court’s factual conclusions. Fairchild v. S.C. Dep’t of Transp., 398 S.C. 90, 727 S.E.2d 407 (2012); see also Univ. of S. Cal. v. Moran, 365 S.C. 270, 617 S.E.2d 135 (Ct.App.2005) (stating the interpretation of a statute approving a compromise agreement presents a question of law); Perreault v. The Free Lance-Star, 276 Va. 375, 666 S.E.2d 352 (2008) (same). For the reasons to be discussed, we hold the circuit court erred in approving the compromise agreement in the current matter.

(1) Eligibility for Court Consideration

We first consider Appellants’ contention that the proposed compromise agreement was ineligible for court consideration.

*426“A compromise agreement is void unless executed in compliance with the governing statute.” In re Estate of Riley, 228 Ariz. 382, 266 P.3d 1078, 1080 (Ct.App.2011). Section 62-3-1102 of the South Carolina Code establishes the following procedure for securing court approval of a compromise agreement resolving an estate controversy:

(1) The terms of the compromise shall be set forth in an agreement in writing which shall be executed by all competent persons and parents acting for any minor child having beneficial interests or having claims which will or may be affected by the compromise....

(2) Any interested person, including the personal representative or a trustee, then may submit the agreement to the court for its approval and for execution by the personal representative, the trustee of every affected testamentary trust, and other fiduciaries and representatives.

(3) After notice to all interested persons or their representatives, including the personal representative of the estate and all affected trustees of trusts, the couri, if it finds that the contest or controversy is in good faith and that the effect of the agreement upon the interests of persons represented by fiduciaries or other representatives is just and reasonable, shall make an order approving the agreement and directing all fiduciaries subject to its jurisdiction to execute the agreement.

S.C.Code Ann. § 62-3-1102 (2009) (emphasis added).6 “Upon the making of the order and the execution of the agreement, all further disposition of the estate is in accordance with the terms of the agreement.” Id. § 62-3-1102(3).7

*427Citing University of Southern California v. Moran, 365 S.C. 270, 617 S.E.2d 135 (Ct.App.2005), Appellants contend “where a trust is beneficiary of a devise, it is the trust, acting through its trustee, which alone has statutory authority to participate in a Section 1102 settlement agreement.”8 Appellants contend the circuit court could not approve the compromise agreement without their consent as trustees. Appellants assert they were not given notice of the parties’ negotiations, so the beneficiaries were unrepresented. They also contend the circuit court erred in finding the AG has the authority to direct or enter into a compromise on behalf of the charitable beneficiaries.

Respondents, in contrast, contend Appellants are improperly attempting to broaden Moran to give a trustee absolute and sole control over settlements, and this is antithetical to the purpose of section 62-3-1102. They state that under Appellants’ theory, the beneficiaries of a trust could never reach a compromise because a trustee could always single-handedly veto the process.

Respondents argue that under the statutory framework, the important question is whether all beneficial interests were represented at the hearing in this matter. The AG asserts he represents the beneficial interests of a charitable trust, but even if he does not, the charitable beneficiaries would have been represented by Appellants at the hearing, since they contended they represented the “trust” and were present to voice their objections to the proposed compromise. Consequently, the charitable beneficiaries were represented at the hearing, either by the AG or by Appellants as trustees. *428Moreover, trustees do not have a statutory right to unilaterally prevent a compromise.

Under the statute, any “interested person”9 may submit the proposed agreement to the court after notice has been given to all interested persons and their representatives, and the agreement must be executed by all persons having “beneficial interests” in the estate10 as well as fiduciaries. Thus, Appellants unquestionably were entitled to notice (and a corresponding opportunity to be heard) and they were necessary signatories based on the express terms of the statute. Appellants dispute, however, whether they were properly noticed and whether their signatures could be compelled by the court, and they contend the agreement was not eligible for the court’s consideration.

Although Appellants were not given notice of the negotiations engaged in by the other parties prior to reaching the settlement, Appellants admittedly were given notice of the proposed compromise ultimately reached, and they fully participated in the extensive hearings held over a four-month period in the circuit court, at which time they were given the opportunity to voice their objections. It is notice of the proposed compromise and any hearings that is statutorily *429required, as it is the final proposal that is subject to the court’s scrutiny under section 62-3-1102. The method by which the proposal was reached, including how many of the parties actively participated in any preliminary discussions, is not a determinative factor in whether the agreement is eligible to be presented to the circuit court for consideration.11

In addition, section 62-3-1102(3) specifically states that if the court “finds that the contest or controversy is in good faith and that the effect of the agreement upon the interests of persons represented by fiduciaries or other representatives is just and reasonable, [it] shall make an order approving the agreement and directing all fiduciaries subject to its jurisdiction to execute the agreement.” S.C.Code Ann. § 62-3-1102(3). Thus, while Appellants were necessary signatories to the compromise, it is clear from the plain language of the statute that the circuit court had the authority to direct their execution of the document if it found the two preceding conditions for approval were met.

The Reporter’s Comments to section 62-3-1102 reiterate that a personal representative or testamentary trustee may be directed by the court to sign the agreement:

Subsection (2) requires submission of the agreement to the probate court for approval. The application for approval may be made by an interested party or by the personal representative. The application would request approval of the agreement and would request an order directing or permitting the personal representative and the trustee of an affected testamentary trust to execute the agreement.

Reporter’s Comments to S.C.Code Ann. § 62-3-1102 (2009) (emphasis added).

The official Comment to section 3-1102 of the Uniform Probate Code, on which our South Carolina statute is based, states the provision for obtaining court approval of compromise agreements was specifically intended to prevent executors and testamentary trustees from single-handedly vetoing such agreements:

*430The thrust of the procedure [for approving settlement agreements] is to put the authority for initiating settlement proposals with the persons who have beneficial interests in the estate, and to prevent executors and testamentary trustees from vetoing any such proposal.... Because executors and trustees may have an interest in fees and commissions which they might earn through efforts to carry out the testator’s intention, the judgment of the cowi is substituted for that of such fiduciaries in appropriate cases.12

Unif. Probate Code, Comment to § 3-1102 (amended 1993), 8 U.L.A. 305 (1998) (emphasis added).

As the Comment to section 3-1102 of the Uniform Act unequivocally states, the purpose of this provision is to prevent trustees from unilaterally vetoing settlement agreements based on a desire to earn fees or based on some other motive. See In re Estate of Riley, 228 Ariz. 382, 266 P.3d 1078, 1083 (Ct.App.2011) (observing the purpose of the statute regarding compromise agreements, which is based on the Uniform Probate Code, is to keep the power to make compromises involving the estate in the hands of the estate’s beneficiaries and to prevent executors and testamentary trustees from vetoing such proposals); In re Estate of Smith, 44 A.D.2d 851, 355 N.Y.S.2d 994, 995 (1974) (stating “Appellant, as executor and trustee under the will, does not have such an interest as would prevent any compromise made among all the parties beneficially interested in the estate”; “the interests sought to be protected under a compromise agreement are those of named and unnamed beneficiaries”); In re Estate of Smith, 75 Misc.2d 895, 349 N.Y.S.2d 281 (1973) (holding the objections of the preliminary executor and nominated executor and trustee to the proposed settlement should be overruled and that the attorney general has the right and power to enter into a compromise on behalf of the ultimate, unspecified, and indefinite charitable beneficiaries mentioned in the decedent’s will); see also In re Will of Seabrook, 90 N.J.Super. 553, 218 A.2d 648, 652 (1966) (holding the beneficiaries of a will could compromise a challenge to a will without the consent of the executors and trustee named in the will and codicil and noting *431the interests of the charitable beneficiaries were represented by the attorney general; the court stated, “ ‘In a proper case the court has power to compel a trustee to execute a compromise agreement.’ ” (citation omitted)); Mary F. Radford, George Gleason Bogert, & George Taylor Bogert, The Law of Trusts & Trustees § 1009, at 450 n. 3 (3d ed. 2006) (“Under UPC §§ 3-1101 and 3-1102 a compromise of a will contest will bind a testamentary trustee.”).

In general, we agree with Appellants that, as the trustees of the 2000 Irrevocable Trust, they were conferred the authority under the trust documents and under South Carolina law to compromise claims involving the trust. However, where the trust involves charitable entities, the trustee has a duty to defend the trust, and the AG has the duty to represent the unspecified charitable beneficiaries. See In Re Estate of Birch, 50 A.D.2d 475, 378 N.Y.S.2d 792, 797 (1976) (stating “[t]he trustee has a legal obligation to defend the trust ... [and] [t]he Attorney General, likewise, has a duty to represent the beneficiaries where there are dispositions for religious and charitable purposes”); see also S.C.Code Ann. § 1-7-130 (2005) (providing the AG shall enforce the due application of funds given or appropriated to public charities within the state); S.C.Code Ann. § 62-7-405(c) (2009) (“The settlor of a charitable trust, the trustee, and the Attorney General, among others may maintain a proceeding to enforce the trust.”); Epworth Children’s Home v. Beasley, 365 S.C. 157, 616 S.E.2d 710 (2005) (stating the AG is the proper party to protect the interests of the public at large in administering or enforcing charitable trusts). The AG was allowed to intervene in this action, without objection, and there is no challenge on appeal as to the propriety of the intervention.13

Contrary to Appellants’ assertion, it was the circuit court, not the AG, which gave final approval to the compromise agreement submitted by the parties, and the circuit court repeatedly noted its duty was to review the compromise to determine if it satisfied the two statutory factors (a good faith *432controversy, a fair and just effect), and it set forth its findings in this regard. In contrast, the requirements to seek court approval of an agreement under section 62-3-1102 are distinguishable, i.e., the agreement must be in writing and executed by all parties with beneficial interests in the estate, it must be submitted to the court by an interested party, notice must be given to all interested parties, and there must be an opportunity to be heard. We find these requirements were met and the compromise was eligible for the court’s consideration.

(2) Section 62-3-1102’s Two-Part Test for Court Approval

Having found the circuit court may approve a compromise agreement after notice to, but over the objection of, Appellants, our next consideration is the propriety of the circuit court’s approval of the agreement itself. In this regard, a two-part test is employed under section 62-3-1102: (1) whether the compromise settles a good-faith controversy between the parties, and (2) whether the compromise is just and reasonable.

In this case, actions were brought by some of Brown’s.adult children and Tommie Rae to set aside Brown’s will and the 2000 Irrevocable Trust on the ground of undue influence. Tommie Rae also claimed she was entitled to an elective share or an omitted spouse’s share of Brown’s estate as his surviving legal spouse, and that her child, James B., was entitled to a share of the estate as an omitted child. In approving the compromise, the circuit court found the settling parties had initiated their contests to Brown’s will and trust in good faith, and that the settlement was just and reasonable. We question whether the parties established the existence of a good faith controversy, but conclude the compromise was not just and reasonable, in any event.

(a) Requirement of a Good Faith Controversy

The first part of the two-part statutory mandate of section 62-3-1101(3) requires that the court “finds that the contest or controversy is in good faith[.]”

The circuit court found that there was a good faith basis for each of the claims asserted by Respondents. As to the claim of undue influence, the circuit court found the credibility of the *433four principal witnesses to the validity of the will and the 2000 Irrevocable Trust was questionable because the attorney who drafted the will, H. Dewain Herring, is now in jail for a crime of violence, and the testimony of the three original trustees, Dallas, Bradley, and Cannon, who had been removed from their fiduciary positions, was suspect and contradictory in prior proceedings. For example, the court noted Dallas had testified that he had knowingly allowed his attorney to agree to a stipulation containing false information because he did not want to lose his position as a fiduciary. The court found the questionable credibility of these four individuals supported the good faith basis of the contestants’ claims. Further, the circuit court found there were several examples of undue influence in the record, including the fact that the trust authorized the trustees to spend up to 50% of gross income for management purposes, and there was a blank deed signed by James Brown and witnessed in Herring’s client file. The court also noted there was a controversy regarding what assets were actually transferred to the trust during Brown’s lifetime.

The circuit court further found a good faith controversy existed regarding the assertion of Tommie Rae for either an elective share14 or an omitted spouse’s share15 of the estate. The court stated that, although Tommie Rae had undergone a *434purported marriage ceremony in 1997 with another man before she had a marriage ceremony with Brown in 2001, Tommie Rae had obtained an annulment of her marriage to Ahmed on April 15, 2004 on the basis Ahmed did not have the capacity to marry. Thus, there was no impediment to her marriage to Brown.16 The circuit court also found that an agreement that Tommie Rae had executed in which she agreed never to assert a common law marriage with Brown had no bearing on Tommie Rae’s claim as a surviving legal spouse. Moreover, after that agreement was executed, Brown published an autobiography in which he referred to Tommie Rae as his “wife” and to James B. as his “son,” so the circuit court found Tommie Rae’s legal status was muddled by the actions of the parties.

Even if Tommie Rae did not prevail on a claim for a spousal share, the circuit court found significant arguments existed to warrant recognizing a claim for an omitted child’s share for James B. under S.C.Code Ann. § 62-2-302 (2009), which would allow the child an intestate share of the probate estate. The court did note that such a claim is not conclusive, however, because if Brown had made transfers to the child that were in lieu of a provision by will, then those transfers could be deemed to satisfy the child’s share.17 The circuit court stated it was not only the presence of each of these individual, *435primary claims, but also their cumulative effect, that supported its finding of a good faith controversy between the parties.

In general, a threat to contest a will must be made in good faith in order for the surrender of the right to constitute consideration for a family settlement, and if it is made in bad faith to extort a settlement, or if the claim is known to be frivolous and -without foundation, then it is not in good faith. M.L. Cross, Annotation, Family Settlement of Testator’s Estate, 29 A.L.R.3d 8, at § 27 (1970 & Supp.2011).

The “good faith” requirement has been variously interpreted, with jurisdictions applying definitions that can be categorized along a continuum from a subjective to an objective standard,18 and they have afforded the claims a level of scrutiny that is less than that given to ordinary contracts, up to what has been described as “close scrutiny.”19

*436However, it is universally acknowledged that full proof of the asserted claims is not required because the raison d’etre for the statute is to dispense with the necessity of litigating the merits of the claims. The circuit court’s duty was not to decide the ultimate question of the merits of the undue influence and other claims; rather, the statutory standard is whether the proposed compromise agreement resolves a good faith controversy and whether the agreement is just and reasonable. See generally M.L. Cross, supra, 29 A.L.R.3d 8 (family settlements); see also Warner v. Warner, 124 Conn. 625, 1 A.2d 911, 914-15 (1938) (stating forbearance in pursuing a claim known to be frivolous or without foundation is not in good faith; however, the question is not whether there was in fact undue influence, but whether the parties could in good faith reasonably believe so, and the test is not whether the claim would have s