In late August 2019, twelve warranty deeds conveying Arizona real estate to a Panamanian entity called the Harris 6 Foundation were recorded on a single day. Three days later, the man who signed them got married. There was no prenuptial agreement, and according to the message his assistant sent his Panamanian lawyer, that was the point. James Ibeling was “considering getting married (without a prenup)” and wanted to protect his assets.
Nearly three months have passed since a divided Iowa Supreme Court held, four votes to three, that the arrangement was permissible under Iowa law. When In re Estate of Ibeling was decided on May 1, 2026, it may have appeared at first glance to address a narrow question of statutory scope: whether Iowa Code § 633.238(1)(d)(1), which sweeps into a surviving spouse’s elective share one-third of the value of property “held in trust” over which the decedent retained the power to alter, amend, or revoke,[i] reaches property owned by a foreign private interest foundation. The decision’s significance, however, lies less in the question presented than in the principle the majority chose in resolving it. The Court has confirmed that Iowa’s elective share can be planned around, on the eve of a wedding and with a stated purpose to defeat a spouse’s claim, by routing assets into an offshore entity that walks, swims, and quacks like a revocable trust, so long as the law that created the entity says it is something else.
The Case in Brief
James Ibeling formed the Harris 6 Foundation in 2013 under the Republic of Panama’s Law No. 25 of 1995, which authorizes private interest foundations (PIFs), an estate-planning vehicle with no analog in American law. For five years the foundation held nothing. In August 2019, with a wedding on the calendar and no prenuptial agreement in the works, James conveyed twelve Arizona properties into it. He was the foundation’s founder and its sole beneficiary during his lifetime. He was also its “protector,” with authority over a foundation council whose three Panamanian members shared his lawyer’s address, took his instructions, and served at his pleasure. On his death in February 2021, the foundation’s assets were to pass to four substitute beneficiaries. His new wife, Nancy, was not among them.
Nancy elected to take the spousal share of James’s estate. The guardian ad litem for the foundation’s minor beneficiary sought a declaratory judgment that its remaining assets, roughly $1.1 million in Arizona real estate after payment of estate debts, sat outside her share. The probate court agreed, the Court of Appeals affirmed on the strength of In re Estate of Myers,[ii] and the Supreme Court granted further review.
The Majority’s Defense of Form
Justice McDonald’s majority opinion anchors itself in the statute’s text. Section 633.238 limits the elective share to four enumerated categories, and Myers established that the list is closed. The statute frames those categories in the vocabulary of trust law, speaking across subparagraph (1)(d)(1) and paragraph (2) of a “settlor,” a “trustee,” and a “revocable trust.” Iowa’s Trust Code defines a trust as an express trust, requiring a settlor’s manifest intention to create one. James manifested the opposite intention. He hired Panamanian counsel precisely to opt out of trust law, and the majority treated that selection as “a substantive decision about the legal regime” rather than a label a court may peel off.
The majority’s deeper principle is one likely to echo beyond Ibeling: where an independent body of law creates a nontrust entity and governs its operation, that body of law occupies the field, and Iowa courts will not superimpose the law of trusts. A PIF is a “juridical person,”[iii] publicly registered, whose assets are insulated from the founder’s personal creditors and, by the express terms of article 14 of its enabling statute, from the inheritance laws of the founder’s domicile.[iv] An Iowa revocable trust is the opposite on both counts, exposed to the settlor’s debts and, by design, to the elective share.[v] To the majority, that structural incompatibility proved the two are “different legal creatures.” Nancy relied on authority holding that an express trust exists whenever its essential components are present, regardless of the formal title given to the arrangement.[vi] Justice McDonald distinguished these cases as involving courts identifying trust relationships in arrangements no other body of law governed rather than reclassifying a juridical entity governed by an independent statutory framework.
What’s in a Name?
Just as “a rose [b]y any other name would smell as sweet,”[vii] a duck by any other name would still quack. Justice Mansfield’s dissent playfully invokes both Shakespeare and the duck test to this end. Strip away the Panamanian labels and what remains is a man who delivered his own property to an entity he controlled, enjoyed its benefit for life, and retained the power to empty it or dissolve it altogether, all consummated three days before a wedding so that his future wife’s statutory rights would never attach. The statute asks whether property was “held in trust” by a settlor who retained the power to alter, amend, or revoke. On the dissent’s reading, every element but the “trust” label was present.
The dissent also surfaced a detail that merits attention—Panamanian law itself explains James’s choice of vehicle. A Panamanian trust cannot unite settlor, trustee, and beneficiary in one person, so foreigners who want to keep control use the PIF instead. In other words, the entity exists in part to deliver revocable-trust functionality to people who cannot lawfully have a revocable trust under local law. That the majority let this classification still carry the day is, to the dissent, exactly the “lawyer’s game” courts should decline to indulge.
The Unresolved Choice-of-Law Question
Sitting between the majority and the dissent is a conflict-of-laws problem that neither opinion fully resolves, and it may be the case’s most consequential feature. Two questions on this point run through Ibeling. The first is validity: was Harris 6 properly created and funded under Panamanian law? The majority’s answer, that any such challenge belongs in Panama, is conventional. The internal affairs of a Panamanian entity are Panama’s to police. The second is characterization: whatever Panama calls the arrangement, is it “property held in trust” within the meaning of an Iowa statute, applied to an Iowa estate in an Iowa probate proceeding? That is a question of Iowa law by definition;[viii] the meaning of words in the Iowa Code cannot be supplied by a foreign sovereign. Yet the majority resolved it by letting the entity’s classification under Panamanian law control. Whether that reflects fidelity to a closed statutory text or an unexamined delegation of Iowa’s characterization of trust entities is arguably the fault line between the two opinions.
This tension is sharpest in the majority’s treatment of article 14 of Panama’s Law No. 25, the provision declaring that “any legal provisions concerning inheritance matters at the founder’s or the beneficiaries’ domicile shall not be assessable against the foundation.” The majority cited this provision as “particularly significant” evidence that a PIF and a revocable trust are different in kind. Standing alone, this may be a fair textual observation. The two instruments are designed for opposite relationships to estate succession. The trouble with this reasoning is that it risks becoming circular, as a foreign statute’s announcement that it is immune from the forum’s inheritance law becomes the reason the inheritance law yields. Domestic courts do not ordinarily permit foreign legislation to fix the reach of a forum statute. Iowa common law supplies a conflicts toolbox in this scenario, as Hussemann ex rel. Ritter v. Hussemann demonstrates in the elective-share setting itself,[ix] but the majority leaves it unopened.
The majority’s principle contains no clearly limiting element beyond the existence of a recognized foreign sovereign.[x] If a trust-like entity’s home law supplies the classification, then the practical reach of Iowa’s elective share can vary with the ingenuity of offshore legislatures. Indeed, the strength of financial asset protection is a margin on which offshore jurisdictions actively compete. The majority responds to these concerns by assuring that such cases have almost never arisen, and the General Assembly can close any gap it disfavors. These answers are not trivial, to be sure, but they depend on external restraint from the legislature and future litigants rather than any safeguards in the ruling itself.
Form, Function, and the Ownership Gap
Beyond the choice-of-law dilemma, the majority’s opinion relies upon the claim that a PIF resembles a corporation, a distinct juridical person with its own assets, debts, and tax identity. This analogy holds at every point except the one that decides elective-share cases. Had James conveyed the Arizona properties to a corporation or a limited liability company, he would have held shares or a membership interest, personal property that flows into the elective share under section 633.238(1)(c). A PIF, by contrast, has no owners at all. James held only beneficiary status and protector powers, neither of which is property under the statute. The entity said to be “much like a corporation” thus defeats the elective share precisely where a corporation would not, a feature that neither opinion pauses over.
There is also a jurisprudential tradition that went unmentioned. For the better part of a century, many U.S. courts have scrutinized transfers made in the shadow of a death or a wedding under a family of doctrines asking whether the decedent genuinely parted with anything. Some disregard as “illusory” a conveyance over which the transferor kept lifetime control and enjoyment; others ask whether the transfer worked a fraud on the survivor’s marital rights; and the augmented-estate statutes now common across the country carry the same impulse forward for will substitutes.[xi] Myers narrowed those routes by holding the elective-share list exhaustive, though that holding closed the roster of asset classes rather than the breadth of the terms within. The functional inquiry could still have lived inside the phrase “held in trust”—that was the dissent’s project, and Ibeling now appears to close that door as well. Where a court sits on the choice between honoring form and policing function is, in the end, a judgment about institutional role. The Ibeling majority left no doubt where it sits: if the form is to be disregarded, the legislature must say so.
Estate Planning after Ibeling
Ibeling is now the controlling word on a question that had not produced a published opinion in the three decades since Panama enacted Law No. 25. Entity classification under the entity’s own governing law is dispositive for elective share purposes in Iowa. The decision does not require concealment, sophistication, or even subtlety; the record in this case contained a written admission of purpose that made no difference. A client contemplating marriage without a prenuptial agreement—or without the future spouse’s knowledge—now has a judicially confirmed alternative, though counsel should be candid that a prenuptial agreement remains a transparent and far less litigable path.
For surviving spouses and their advocates, the lesson is that the elective share is a creature of statute and its protections end where the enumerated list ends. Even so, the decision forecloses less than a first reading may suggest. The majority resolved only the Iowa statutory question. It expressly declined to decide whether Harris 6 was validly created or funded, pointing any such challenge to Panama.
The more promising path to challenge trust-like entities may not run through Iowa at all. That referral to Panama reaches only questions of Panamanian law. Whether twelve warranty deeds validly conveyed Arizona land is a question for the place where the land sits. The foundation’s remaining assets are Arizona real estate, and the guardian ad litem’s own expert conceded that a judge in such a jurisdiction may disregard Panama’s territorial statute when an inheritance controversy arises in the founder’s domicile. The real significance of the situs forum is not that it offers a friendlier venue for the same argument. After Ibeling, reclassification is a proven loser under Iowa’s statute, and an Arizona court applying Iowa law would be bound by that answer. That forum instead invites arguments that never mention the word “trust.” A successful challenge to the conveyances would return the properties to the estate, and because the deeds were recorded three days before the wedding, setting them aside would mean the decedent presumably possessed the land during the marriage—bringing it within the elective share as ordinary real property under section 633.238(1)(a). The next contest over a PIF holding U.S. real estate may accordingly be fought where the land is, on ground Ibeling never touched.
An Invitation Across the Street
The majority twice stated that Nancy’s policy arguments belonged with the legislature. An amendment to section 633.238 reaching property held by any entity, foreign or domestic, over which the decedent retained trust-equivalent control and lifetime benefit would answer the decision on its own terms. The General Assembly has tended the elective share’s boundaries before, and it has not always waited for a final decision. In 2005, it enacted the very provision Nancy relied on, section 633.238(1)(d)(1)—doing so while Sieh v. Sieh, which established that a surviving spouse could reach a revocable trust, was still pending.[xii] Four years later, it added the “limited to” language later enforced in Myers.[xiii] A one-vote margin on the state’s highest court is the kind of signal that tends to draw legislative attention. With the 2026 session behind us, any response likely waits until January.
The majority predicted that Ibeling is unlikely to send Iowans streaming toward Panamanian counsel, noting that this was the first PIF case in thirty years. This will likely hold true, and even the dissent agreed that Iowa’s probate system will survive the decision. But estate planning practice, as with many areas of the law, has a way of metabolizing a green light. Three months on, the most durable thing about Ibeling may be the instruction it gives to planners and challengers alike. In Iowa, the elective share reaches exactly the property on the closed list contained in the Iowa Code, and not one word more. When the entity holding the property was born abroad, it is the entity’s own law that says whether it fits those words, allowing the outer boundary of an Iowa spouse’s statutory protection to be drawn, in part, by a legislature in Panama City.
[i]Iowa Code § 633.238(1)(d)(1) includes in the elective share “[o]ne-third in value of the property held in trust not necessary for the payment of debts and charges over which the decedent was a settlor and retained at the time of death the power to alter, amend, or revoke the trust, or over which the decedent waived or rescinded any such power within one year of the date of death, and to which the surviving spouse has not made any express written relinquishment” in compliance with the statute.
[ii]In re Estate of Myers, 825 N.W.2d 1, 6, 8 (Iowa 2012) (holding that the elective share is limited to the four categories of property specifically enumerated in section 633.238 and does not reach payable-on-death accounts and similar nonprobate assets).
[iii]“Juridical person” is a legal term for an entity the law treats as a person in its own right (e.g., able to own property, incur obligations, and sue and be sued in its own name), also known in the common law as a “legal” or “artificial” person. Important for this case is that an Anglo-American trust is not a juridical person but a relationship, with title held by the trustee, while a PIF holds title to its assets itself.
[iv]Panama Law No. 25 of June 12, 1995, arts. 9, 11, 14. Article 9 gives a foundation juridical personality upon registration of its charter in the Public Registry; article 11 insulates foundation property from the personal liabilities of the founder and beneficiaries; article 14 provides that inheritance-law provisions of the founder’s or beneficiaries’ domicile are not assessable against the foundation.
[v]See Iowa Code § 633A.3104(1)–(2) (subjecting revocable trust property to the settlor’s debts during life and, with exceptions, to the charges and debts of the settlor’s estate at death).
[vi]In re NFO Members’ Custodial Account, 255 N.W.2d 162, 163–65 (Iowa 1977) (en banc); Drewes v. Schonteich, 31 F.3d 674, 676–77 (8th Cir. 1994). Nancy also cited In re Trust Created by Hormel, 163 N.W.2d 844 (Minn. 1968), which the Court set aside on different grounds—Hormel involved an undisputed, existing trust, and the only question was whether a charitable corporation could serve as its trustee.
[vii]William Shakespeare, Romeo and Juliet act 2, sc. 2, ll. 43–44 (“What’s in a name? That which we call a rose / By any other name would smell as sweet.”)
[viii]See Restatement (Second) of Conflict of Laws § 7 (characterization is governed by the forum’s own law and concepts).
[ix]See Hussemann ex rel. Ritter v. Hussemann, 847 N.W.2d 219, 222–23 (Iowa 2014) (analyzing a Florida postnuptial agreement’s choice-of-law provision in Iowa court under a balancing test drawn from the Restatement (Second) of Conflict of Laws).
[x]The dissent offered a hypothetical in which Missouri enacts a statute shielding revocable trusts from the settlor’s creditors, reasoning that an Iowan could not defeat all creditors simply by moving assets into a Missouri revocable trust—at a minimum, a choice-of-law question would arise. In fact, the majority’s position is more extreme than this hypothetical, as it extends not only to governments within our federal system but to foreign regimes wholly untethered from the protections and jurisdiction of the United States.
[xi]The seminal articulation is Newman v. Dore, 275 N.Y. 371, 9 N.E.2d 966 (1937), which held illusory a conveyance made three days before the transferor’s death for the purpose of defeating his wife’s statutory rights. Though this decision was later narrowed in its home state and has since been displaced there by New York’s testamentary-substitute legislation, now N.Y. Est. Powers & Trusts Law § 5-1.1-A, its substance-over-form inquiry persists in the decisional law of other jurisdictions and in the Uniform Probate Code’s augmented estate.
[xii]Sieh v. Sieh, 713 N.W.2d 194 (Iowa 2006); 2005 Iowa Acts ch. 38, § 14 (enacting what is now section 633.238(1)(d)).
[xiii]2009 Iowa Acts ch. 52, § 4 (adding the “limited to” language).