Justia Trusts & Estates Opinion Summaries

Plaintiff, a beneficiary of the Carolyn Patricia Young Family Trust, alleged that defendants, the trust protector and trustee, were conspiring to withhold trust funds improperly. The alleged conspiracy aimed to preserve assets for the trustee, who is also a residuary beneficiary. Plaintiff sought an ex parte application to suspend the defendants' powers and appoint an interim trustee. The Superior Court of Orange County granted the application, suspending the defendants' powers, appointing an interim trustee, requiring a bond, setting a review hearing, and prohibiting the interim trustee from using trust assets for compensation without prior court authorization.Defendants appealed the order. Plaintiff moved to dismiss the appeal, arguing the order was not appealable. The California Court of Appeal, Fourth Appellate District, Division Three, reviewed the appealability of the order. The court held that orders suspending trustees and appointing interim trustees in probate court are not directly appealable. The court emphasized that such orders are provisional and not final, aligning with the broader policy against piecemeal appeals.The court dismissed the appeal, concluding that neither Probate Code section 1300 nor section 1304 provided a basis for appealability. The court also found that defendants lacked standing to appeal the portions of the order imposing a bond requirement and prohibiting the use of trust assets for compensation without prior court authorization. Additionally, the court denied plaintiff's motion for sanctions, despite concerns about defendants' counsel's conduct, which the court found troubling but not sufficient to warrant sanctions in this instance. View "Young v. Hartford" on Justia Law

The case involves a dispute over whether the proceeds of an Individual Retirement Account (IRA) should be included in the estate of a deceased individual, Thomas Reich, for the purpose of calculating the share of his surviving spouse, Pamela Reich, as an "omitted spouse" under California law. Thomas had created a revocable trust in 2003, which was amended in 2016, to distribute his assets upon his death. He designated his daughter and granddaughter as beneficiaries of the IRA, which had a balance of approximately $1.5 million at the time of his death. Thomas married Pamela in 2020 but did not update his trust to provide for her before his death in 2021.Pamela initially filed a petition seeking an omitted spouse's share of Thomas's estate, including the IRA proceeds. The Los Angeles County Superior Court overruled a demurrer by the trust's beneficiaries, suggesting that the IRA proceeds might be included in the estate. However, a partial settlement was reached, excluding the IRA proceeds from Pamela's share. Pamela then filed two new petitions regarding her entitlement to the IRA proceeds, which were assigned to a different judge.The California Court of Appeal, Second Appellate District, reviewed the case and affirmed the probate court's orders dismissing Pamela's petitions. The court held that the IRA proceeds are nonprobate assets and do not pass through the decedent's testamentary trust to the separate trusts created for the beneficiaries. Therefore, the IRA proceeds are not part of Thomas's "estate" for the purpose of calculating Pamela's omitted spouse's share. The court also noted that the prior demurrer ruling was not controlling in this context. View "Reich v. Reich" on Justia Law

Dr. Laura Dean Head, a college professor, passed away in 2013, leaving behind her sisters, Della Hamlin and Helaine Head. Shortly before her death, Dr. Head executed a trust naming her former student and friend, Zakiya Jendayi, as the trustee and sole beneficiary. In 2020, Hamlin and Head petitioned the probate court to invalidate the trust, alleging undue influence, lack of capacity, and forgery. After a 17-day bench trial, the court found that Jendayi had exerted undue influence over Dr. Head and invalidated the trust.The probate court determined that Hamlin and Head, as intestate heirs disinherited by the trust, had standing to contest the trust. The court applied the common law presumption of undue influence, finding that Jendayi had a confidential relationship with Dr. Head, actively participated in procuring the trust, and would unduly benefit from it. The court also found substantial evidence supporting the presumption of undue influence and rejected Jendayi’s claims of judicial bias. The court concluded that any deficiencies in its statement of decision were harmless and affirmed the judgment.The California Court of Appeal, First Appellate District, Division Three, reviewed the case. The court affirmed the probate court’s judgment, holding that Hamlin and Head had standing to contest the trust. The appellate court found substantial evidence supporting the probate court’s application of the presumption of undue influence and its finding of undue influence. The court also concluded that the probate court did not demonstrate judicial bias and that any deficiencies in the statement of decision were harmless. The judgment was affirmed. View "Hamlin v. Jendayi" on Justia Law

Trudy Maxwell, a 93-year-old resident of Atria Park of San Mateo, died after ingesting an industrial strength cleaner mistakenly served to her by an Atria employee. Trudy’s eight surviving children, including James Maxwell III (James III), filed a lawsuit against Atria Management Company and related entities, alleging negligence, wrongful death, and elder abuse. The trial court denied Atria’s motion to compel arbitration, concluding that James III, who signed the arbitration agreement, was not authorized to do so under his durable power of attorney (DPOA) because he was not authorized to make health care decisions for Trudy. Instead, Trudy’s daughter, Marybeth, held the power of attorney for health care.The Atria defendants appealed, arguing that James III had the authority to sign the arbitration agreement and that all of Trudy’s heirs were bound to arbitrate their wrongful death claims. They also contended that California’s Code of Civil Procedure section 1281.2(c), which allows an exception to arbitration when third-party claims may be affected, was preempted by the Federal Arbitration Act (FAA).The California Court of Appeal, First Appellate District, Division One, reversed the trial court’s order denying arbitration and remanded the case for further proceedings. The appellate court instructed the trial court to reconsider the validity of the arbitration agreement in light of the California Supreme Court’s recent decision in Harrod v. Country Oaks Partners, LLC, which held that agreeing to an optional arbitration agreement is not a health care decision. The appellate court also directed the trial court to determine whether the DPOA was valid and whether James III had the authority to agree to arbitration despite Marybeth holding the health care POA. Additionally, the court noted that the wrongful death claims of Trudy’s children were not subject to arbitration as they were not parties to the arbitration agreement. View "Maxwell v. Atria Management Co., LLC" on Justia Law

Jeffrey G. Grossman and his family sued attorney John Peter Wakeman, Jr. and Wakeman Law Group, Inc. for legal malpractice. The plaintiffs claimed that Wakeman negligently prepared estate planning documents for Dr. A. Richard Grossman, which disinherited them in favor of Richard's fourth wife, Elizabeth Grossman. Richard's estate was valued at $18 million, and the plaintiffs argued they were the intended beneficiaries. The jury found in favor of the plaintiffs, awarding $9.5 million in damages.The Ventura County Superior Court denied Wakeman's motion for judgment notwithstanding the verdict. Wakeman appealed, arguing that he owed no duty of care to the plaintiffs, as they were not his clients. He contended that his duty was solely to Richard, who had instructed him to leave everything to Elizabeth.The California Court of Appeal, Second Appellate District, Division Six, reviewed the case. The court concluded that the evidence was insufficient to show that Wakeman owed a duty of care to the plaintiffs. The court emphasized that there was no clear, certain, and undisputed evidence of Richard's intent to benefit the plaintiffs. Testimonies from Elizabeth and others supported Wakeman's claim that Richard intended to leave his estate to Elizabeth. The court held that imposing a duty on Wakeman to the plaintiffs would place an intolerable burden on the legal profession.The Court of Appeal reversed the judgments and remanded the case to the trial court with directions to enter judgment in favor of Wakeman and his law group. The appeal from the order denying the motion for judgment notwithstanding the verdict was dismissed as moot. View "Grossman v. Wakeman" on Justia Law

Carla Montgomery petitioned to receive a share of her deceased father Benjamin C. Williams' trust estate, claiming she was an omitted child under Probate Code section 21622. Carla was born following a brief relationship between her mother, Annie Elliott, and Benjamin in the 1960s. Benjamin, who fathered seven children in total, moved to California shortly after Carla's conception and was unaware of her birth. In 1999, Benjamin executed a trust naming only his two youngest children, Benita Ligia Williams and Benjamin S. Williams, as beneficiaries. Carla learned of Benjamin's death and the trust's existence in 2019 and subsequently petitioned for a share of the estate.The Superior Court of San Bernardino County held a one-day trial where evidence and testimonies were presented. The court found that Benjamin was unaware of Carla's birth when he executed the trust but concluded that Carla failed to prove that her omission was solely due to Benjamin's unawareness of her existence. The court noted that Benjamin had also omitted four other known children from his trust, indicating his intent to provide only for the two named beneficiaries. Consequently, the court denied Carla's petition and entered judgment against her.The Court of Appeal, Fourth Appellate District, Division One, State of California, reviewed the case de novo. The court agreed with the trial court's application of the reasoning from Rallo v. O’Brian, which requires an omitted child to prove that the sole reason for their omission was the testator's unawareness of their birth. The appellate court found that Benjamin's omission of his other known children demonstrated his intent to exclude all preexisting children, known or unknown. Therefore, the court affirmed the trial court's judgment, denying Carla's petition and awarding costs on appeal to Benita. View "Estate of Williams" on Justia Law

In 2020, several residents at a skilled nursing facility died from coronavirus infections. Family members of the deceased sued the facility and its alleged alter egos, asserting claims including elder abuse, negligence, and wrongful death. The defendants moved to compel arbitration based on agreements signed by family members rather than the decedents. The trial court denied the motion, finding no evidence that the family members had authority to sign on behalf of the decedents, and that the agreements did not bind the family members in their individual capacities. For one agreement where a family member had power of attorney, the court exercised its discretion to deny arbitration to avoid conflicting results.The Shasta County Superior Court denied the motion to compel arbitration. It found that the defendants did not provide evidence that the family members had authority to sign the arbitration agreements on behalf of the decedents. Additionally, the court ruled that the agreements did not bind the family members in their individual capacities. For the agreement involving a power of attorney, the court denied arbitration to prevent conflicting rulings between court and arbitration proceedings.The California Court of Appeal, Third Appellate District, reviewed the case. It affirmed the lower court's decision, holding that the defendants failed to establish that the family members were authorized agents of the decedents. The court also found that the family members did not sign the agreements in their individual capacities, and thus were not bound by them. Furthermore, the court upheld the trial court's discretion to deny arbitration for the claim involving a power of attorney to avoid conflicting rulings. The order denying the motion to compel arbitration was affirmed. View "Hearden v. Windsor Redding Care Center" on Justia Law

Kathleen and Bruce Smith filed a petition to confirm the validity of a 2016 amendment to a trust established by Ernest Myers. The amendment would grant the Smiths Ernest’s 54.2 percent interest in a property, adding to their existing 45.8 percent interest. Without the amendment, the trust would give Ernest’s interest to Emma Myers, his widow. Emma argued that the Smiths’ petition was barred by the statute of limitations under Code of Civil Procedure section 366.3, which requires claims arising from a promise or agreement with a decedent to be filed within one year of the decedent’s death.The Superior Court of Glenn County denied Emma’s motion for summary adjudication, concluding that section 366.3 did not apply to the Smiths’ petition, as it concerned the internal affairs of a trust rather than a promise relating to a distribution. After a bench trial, the court ruled in favor of the Smiths, validating the amendment and ordering Emma to transfer the property interest to them. Emma’s cross-petition to invalidate the amendment was denied.The Court of Appeal of the State of California, Third Appellate District, reviewed the case. The court affirmed the lower court’s decision, agreeing that section 366.3 did not apply to the Smiths’ petition. The court held that the statute of limitations in section 366.3 pertains to claims based on promises or agreements to create testamentary documents, not to claims based on the documents themselves. Consequently, the trial court’s judgment in favor of the Smiths was upheld, and Emma’s appeal was dismissed. View "Smith v. Myers" on Justia Law

Carlton Loeber, the trustor of an irrevocable trust owning two undeveloped properties within the Lakeside Joint School District, sought to place an initiative on the ballot to exempt taxpayers over 65 from any district parcel tax on undeveloped parcels. The district declined to call the election, citing cost concerns and legal objections. Loeber filed a petition for a writ of mandate to compel the district to place the initiative on the ballot. The trial court dismissed the petition, ruling that Loeber lacked standing.The trial court found that Loeber did not have a direct and substantial interest in the initiative because he did not personally own property in the district and failed to show that the trust could qualify for the exemption. The court also rejected Loeber’s public interest standing argument, noting the lack of public engagement and the significant cost to the district. The court concluded that the public need was not weighty enough to warrant the application of the public interest exception.The California Court of Appeal, Sixth Appellate District, reviewed the case and determined that Loeber had standing under the public interest exception, given the significant public right at issue concerning the initiative power. However, the court concluded that the proposed initiative did not fall within the scope of Article XIII C, Section 3 of the California Constitution, which allows initiatives to reduce or repeal local taxes. The court held that the initiative, which sought to create a new exemption for certain taxpayers, did not constitute "reducing" a tax within the meaning of the constitutional provision. Consequently, the district was not obligated to call an election on the initiative. The judgment was modified to deny the writ petition and affirmed as modified. View "Loeber v. Lakeside Joint School District" on Justia Law

The case revolves around a dispute over the interpretation of a trust. Jerry and Mary Trotter established the Trotter Family Revocable Trust in 2011, naming themselves as both trustees and trustors. Upon Jerry's death in 2012, Mary became the sole trustee. The trust provided that upon the death of the surviving spouse, certain stock would be distributed to their son, Timothy, and the rest of the estate would be divided equally among several children, including Jerry's daughter from a previous marriage, Wendy Trotter Van Dyck. In 2020, Mary expressed her intention to exclude Van Dyck from the trust beneficiaries via email and a questionnaire. However, she passed away before a formal amendment to the trust could be made.The probate court was asked to determine whether Mary's emails and the questionnaire constituted a valid amendment to the trust. The court found that Mary's writings were insufficient to constitute an amendment, as they were not signed as required by the trust and did not adequately express an intent to amend the trust. The court ordered that the trust be distributed to its original beneficiaries, including Van Dyck. Timothy appealed this decision.The Court of Appeal, Fourth Appellate District Division One State of California, affirmed the lower court's decision. The appellate court agreed that Mary's writings did not meet the requirements for a valid amendment to the trust. The court found that the writings were not signed as required by the trust, and the electronic signature provision of the Uniform Electronics Transaction Act (UETA) did not apply because a unilateral trust amendment does not constitute a "transaction" within the meaning of the statute. Furthermore, the court found that Mary's writings did not adequately express an intent to amend the trust by the writings themselves. View "Trotter v. Van Dyck" on Justia Law