Trusts and Estates
Ca. Trs. & Estates Quarterly 2019, Volume 25, Issue 4
- Application For Leave To File Amicus Curiae Brief
- Brief of Amicus Curiae Executive Committee of the Trusts and Estates Section of the California Lawyers Association In Support of Petitioner
- Chairs of Section Subcommittees
- Does Kaestner Have Any Relevance For the Taxation of Trusts In California?
- Editorial Board
- From the Chair
- From the Editors-in-chief
- Inside this Issue:
- Litigation Alert
- Tax Alert
- Tax Planning Using California's Decanting Statute
- Till Death Do We Litigate That Divorce
- Tips of the Trade: Pitfalls of Split-interest Trusts For Blended Families
- Barefoot V. Jennings: a Disinherited Trust Beneficiary's Standing To Bring a Trust Contest In Probate Court Now Teeters Before the California Supreme Court
BAREFOOT V. JENNINGS: A DISINHERITED TRUST BENEFICIARY’S STANDING TO BRING A TRUST CONTEST IN PROBATE COURT NOW TEETERS BEFORE THE CALIFORNIA SUPREME COURT
By Howard Kipnis*
For decades most trust litigators believed the California Probate Code provided them with a full arsenal for contesting trust instruments. That is, it authorized both external and internal trust contests. For example, contestants with no beneficial interest in the challenged trust would be able to set aside the entire trust or seek to set aside transfers of specific assets funded into it externally by asserting title and/or conveyance claims under Probate Code section 850.1 Alternatively, contestants attempting to establish a beneficial interest in the challenged trust, but not invalidate the trust itself, would be able to pursue their contests internally by asserting rights as a trust beneficiary via Probate Code section 17200. But then came Barefoot v. Jennings (2018) 27 Cal. App.5th 1 ("Barefoot").
Barefoot undermined this paradigm when it held that a former trust beneficiary lacks standing under section 17200 to bring a contest challenging the validity of trust instruments that result in the contestant’s disinheritance. According to the Barefoot court, if a contestant is not a named beneficiary under the latest iteration of the trust, he/she does not fall within the statutory definition of a "beneficiary" set forth in Probate Code section 24.2 Hence, under Barefoot, allegations that the petitioner was a trust beneficiary under a prior version of the trust and that the subsequently-executed trust instruments disinheriting him/her were invalid on traditional contest grounds (i.e., lack of capacity, undue influence, fraud) are insufficient as a matter of law to confer standing – – even at the pleading stage.
The practical result of the holding in Barefoot is that contestants who are not named as beneficiaries in the latest version of a trust cannot bring a contest under section 17200 even if they could prove they are in fact trust beneficiaries. Instead, the Barefoot court intimated that the sole recourse of a would-be beneficiary seeking to establish their beneficial interest in a trust is a civil action. See Barefoot, supra, 27 Cal.App.5th at 8, ft. 2 ("A complaint alleging the same cause of action would not be barred by the beneficiary limitation of section 17200.") Nevertheless, the court failed to identify the sorts of claims disinherited trust beneficiaries could bring in a civil action seeking to invalidate modifications to a trust in light of the "exclusive jurisdiction" over "the internal affairs" of the trust accorded to the probate court. (See Prob. Code § 17000(a).)