Justia Trusts & Estates Opinion Summaries

Articles Posted in California Courts of Appeal

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In 1986, Robert Levin established a revocable trust, and was thereafter amended several times: in 1993, 2002, 2005, 2006, 2008, 2011 and 2012. After Robert passed away in 2015, litigation erupted, principally over the 2008 and 2012 amendments. Elizabeth Levin, Robert’s daughter from a prior marriage, sued Robert’s widow, Debra Winston-Levin, on multiple grounds which, by the time the matter went to trial, had devolved into causes of action for an order compelling the return of certain Levin Trust property pursuant to Probate Code section 850, and for double damages pursuant to Probate Code section 859. With regard to the 2012 amendment, the trial court found a presumption of undue influence went unrebutted by Debra. As a result, the court voided the entire 2012 amendment and ordered Debra to return property she had obtained pursuant to the 2012 amendment and a related deed. Elizabeth appealed, contending the court erred in three ways: (1) the court’s finding of undue influence compelled a finding that Debra was liable for financial abuse of an elder, which, in turn, compelled an award of double damages under Probate Code section 859; (2) the evidence compelled a finding that undue influence tainted the 2008 amendment; and (3) the court erred in voiding the entire 2012 amendment rather than carving out only those portions that benefited Debra. The Court of Appeal concluded the trial court correctly interpreted section 859; the court’s ruling was supported by substantial evidence; and a reasonable inference from the cumulative changes in the amendment were that they were intended to be intertwined, such that voiding only those portions benefiting Debra would not effectuate Robert’s intent. Accordingly, the Court of Appeal affirmed the judgment. View "Levin v. Winston-Levin" on Justia Law

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At issue before the Court of Appeals was whether James Robert Anderson, settlor and trustee of the James Robert Anderson Revocable Trust (the trust), validly amended the trust when he made handwritten interlineations to one of the operative trust documents, specifically the First Amendment to the trust (First Amendment), making Grey Dey a beneficiary. After making the interlineations, Anderson sent both the original trust instrument and the interlineated First Amendment to his attorney to have the new disposition of his trust estate formalized in a second amendment to the trust. Anderson died before the formal amendment was prepared for his signature. Margaret Pena, successor trustee, petitioned the trial court for instructions as to the validity of the interlineations. She moved for summary judgment, asserting the interlineations did not amount to a valid amendment to the trust as a matter of law. The trial court granted the motion and entered judgment in Pena’s favor. Dey appealed, but the Court of Appeal concurred with the trial court: the interlineations did not validly amend the trust because the trust specifically requires amendments “be made by written instrument signed by the settlor and delivered to the trustee. … While the law considers the interlineations a separate written instrument, and while there can be no doubt Anderson delivered them to himself as trustee, he did not sign them.” While there was no dispute in this case that Anderson intended Dey to receive a portion of his trust estate, there was also no genuine dispute that Anderson intended to sign this and other changes to his trust when formalized by his attorney. Unfortunately, he died before that could be accomplished. View "Pena v. Dey" on Justia Law

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Defendant, the beneficiary of a spendthrift trust created by his father, appealed the probate court's order directing the trustee to pay a portion of defendant's 2018 principal disbursement to four judgment creditors in partial satisfaction of their money judgment. The Court of Appeal affirmed and held that a judgment creditor may file a petition under Probate Code section 15301(b) before a debtor/trust beneficiary's trust distribution is "due and payable." The court also held that the probate court did not abuse its discretion by ordering the trustee to delay the payment of defendant's 2018 principal disbursement until after it issued its final ruling on the creditors' petitions. Finally, the court held that defendant's other arguments were unavailing, and because the trust was not a support trust, the personal receipt clause did not shield defendant from creditor claims. View "Blech v. Blech" on Justia Law

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The Court of Appeal affirmed the probate court's order denying plaintiffs' request, following the death of their daughter, that the remainder of their daughter's special needs trust be distributed to them rather than to the Department of Health Care Services as reimbursement for Medi-Cal payments for their daughter's medical care. The court held that the mandatory recovery rules for special needs trusts apply to the trust remainder; plaintiffs' interpretation of Probate Code section 3605 conflicts with federal law; the Centers for Medicare & Medicaid Services' opinion letter supports the Department's position that section 3605 permits the Department to recover for the daughter's Medi-Cal expenses; public policy considerations weigh in favor of permitting reimbursement to the Department; and the trust itself requires reimbursement to the Department. The court also held that plaintiffs failed to show that the Department's claim impermissibly included services under the Individuals with Disabilities Education Act and Lanterman Act. View "Gonzalez v. City National Bank" on Justia Law

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Edith Rogers appealed her removal as administrator of the estate of her grandfather Roscoe Sapp, Sr. (decedent), who died in 1994. Armuress Sapp and Brian Lincoln, two of decedent’s grandsons, separately petitioned to remove Rogers as administrator. The probate court found Rogers: (1) had failed to comply with the court’s 2001 instructions that she and her coadministrator (who died in 2003) sell the estate’s remaining real estate holdings and distribute the net proceeds to the beneficiaries of the decedent’s will; and (2) acted in bad faith toward the beneficiaries by trying to buy them out for much less than they would have received if she had timely sold the properties. The court therefore concluded Rogers had to be removed because she “mismanaged” the estate and was “incapable of properly executing the duties of the office” of administrator. The probate court withdrew letters of administration issued to Rogers and appointed Armuress as special administrator. In her briefs, Rogers challenged: (1) the 2001 order instructing the coadministrators to sell the estate’s real property; (2) the probate court’s 2016 denial of her petition for additional instructions; and (3) the 2017 judgment removing her as personal representative. The Court of Appeal determined the 2017 judgment was properly before it. Although the Court concluded the evidence did not support a finding that Rogers was incapable of executing the duties of administrator, the evidence supported her removal because she was not otherwise qualified to act as administrator, and she mismanaged the estate. Because the Court concluded Rogers did not demonstrate the probate court abused its discretion when it removed her, judgment was affirmed View "Estate of Sapp" on Justia Law

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Almost twenty years after four dentists formed a partnership to acquire and maintain a dental office building, the then-partners amended their agreement to allow one of the partners, Dr. Richard Hallberg, to assign his partnership interest to his living trust, and to substitute the trustee (then Dr. Hallberg) as a general partner in place of Dr. Hallberg individually. Litigation ensued 15 years later after Dr. Hallberg's death over whether, despite the substitution, Dr. Hallberg was still a partner at the time of his death, which would trigger buyout provisions that applied in the event of a partner's death. While a trust cannot act in its own name and must always act through its trustee, a trust is a "person" that may associate in a partnership under the Uniform Partnership Act of 1994 (UPA), based on the plain language of the UPA's definition of "person." The clear statutory language is reinforced by other provisions of the statute, as well as by its legislative history. The Court of Appeal held that Dr. Hallberg was not a partner when he died. Rather, his trust, or the trustee of his trust, was the partner. The court saw no contradiction between the terms of the UPA and California trust law. To the extent Presta v. Tepper, (2009) 179 Cal.App.4th 909, 918, suggested otherwise, the court disagreed. Accordingly, the court reversed the trial court's judgment holding that the trust was not a separate legal entity. View "Han v. Hallberg" on Justia Law

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Plaintiff appealed the probate court's order striking her petition to enforce a no contest clause in a trust under the anti-SLAPP statute, Code of Civil Procedure 425.16, and denying her motion to recover attorney fees. The Court of Appeal agreed with the probate court, and with a recent decision by Division Five of this district, that the anti-SLAPP statute applies to a petition such as plaintiff's seeking to enforce a no contest clause. However, the court held that plaintiff adequately demonstrated a likelihood of success under the second step of the anti-SLAPP procedure. In this case, defendant's judicial defense of the 2007 Amendment to the Trust that she procured through undue influence met the Trust's definition of a contest that triggered the no contest clause. Furthermore, under sections 21310 and 21311, that clause was enforceable against defendant. The court also held that plaintiff provided sufficient evidence that defendant lacked probable cause to defend the 2007 Amendment. The court held that the findings of the probate court concerning defendant's undue influence, which this court affirmed, provided a sufficient basis to conclude that plaintiff has shown a probability of success on her No Contest Petition. Finally, the court held that plaintiff had the contractual right to seek reimbursement of her attorney fees incurred in resisting defendant's appeal of the probate court's ruling invalidating the 2007 Amendment. Accordingly, the court reversed and remanded. View "Key v. Tyler" on Justia Law

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This case presented two issues for the Court of Appeals' review: (1) whether the nonmarital biological child of an absentee father who never openly held her out as his own have standing under Code of Civil Procedure section 377.60 to sue for his wrongful death if she failed to obtain a court order declaring paternity during his lifetime?; and (2) if she did not have standing, did section 377.60 violate the state or federal equal protection clauses? Upon the specific facts of this case, the Court concluded the child did not have standing, and there was no equal protection violation. "We cannot imagine the Legislature intended to confer wrongful death standing on a child who had no relationship whatsoever with the decedent to the exclusion of the decedent’s other family members with whom he did have a relationship." View "Stennett v. Miller" on Justia Law

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Petitioner David Dudek appealed after the trial court sustained the demurrer of respondents Anne Kebisek Dudek, Tiffany Guzman, Jeanette Kebisek, Mary Kebisek, Guillermo Andrade, Maria Sanchez, Ora Day, Tonya Courtney, and Michael Quinn to David's petition to recover money distributed to the respondents in accordance with the beneficiary designation of Genworth Life Insurance Policy #5804946 (the Policy), which covered the life of J.D. Dudek (J.D.), Petitioner's brother. According to David, in late 2009, J.D. created and executed the J.D. Dudek Life Insurance Trust, naming David as the trustee. David asserted the Policy was listed as an asset of the Trust, to be held and administered in accordance with the Trust's terms. According to the Petition, J.D. prepared and submitted to the life insurance company the forms required by that company to change the ownership and beneficiary designations on the Policy in order to establish David, as trustee, as the sole owner and named beneficiary of the Policy. David was unaware that not long after J.D. submitted the forms, the insurance company rejected the ownership and beneficiary designation forms because J.D. had altered some of his entries without initialing the changes. David was also unaware that J.D. had failed to file corrected forms with the life insurance company after he was notified of the insurance company's rejection of his submitted forms. After J.D. died, David produced the Trust to the life insurance company and sought to obtain the proceeds of the policy. However, the life insurance company distributed the proceeds of the policy to the beneficiaries that it had on file, pursuant to the beneficiary designations that J.D. submitted prior to the alleged change. David subsequently sought an order directing the respondents to transfer the proceeds of the Policy to him as the trustee of the Trust. The Court of Appeal reversed the trial court, finding that if David could establish the facts alleged in the Petition, then it would be clear that J.D. created an irrevocable trust, and properly funded it, when he delivered to David the transferring document. "If the Trust was created, then David's entitlement to the proceeds of the life insurance policy that was an asset of the Trust would be established, and he would be able to seek the court's assistance in having those proceeds conveyed to him in his capacity as trustee. The trial court therefore should not have sustained the respondents' demurrer to David's Petition." View "Dudek v. Dudek" on Justia Law

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Lieselotte Herzog (the Decedent) died intestate on October 17, 2013. In April 2014, the probate court issued letters of administration appointing Winnfred Herzog (Nephew) as the administrator of the estate. Kemp & Associates, Inc. (Kemp), a firm specializing in locating heirs, held a power of attorney for Maurene Schraff Nadj (Half Sister). In July 2016, Kemp petitioned the probate court for a determination that Half Sister was the Decedent’s sole heir. The probate court denied Kemp’s petition with prejudice for insufficient evidence. Kemp appealed, arguing the probate court erred: (1) by bifurcating the issue of whether Half Sister was the Decedent’s heir; (2) by concluding Kemp did not meet its burden of proof; and (3) by ruling Kemp’s evidence was inadmissible. In addition, Kemp contended Nephew lacked standing to oppose Kemp’s petition. Finding no reversible errors, the Court of Appeal affirmed. View "Estate of Herzog" on Justia Law