Trusts and Estates

2011 Case Alerts

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Estate of Kampen

Filed November 14, 2011, publication ordered December 9, 2011, First District, Div. Two
Cite as 2011 S.O.S. 6662

Personal representative who failed to distribute estate for approximately 9 years after the order of final distribution was not surcharged for interest.  The court reasoned that (1) the order of final distribution was not a money judgment under Code of Civil Procedure Section 680.270 and thus prejudgment interest did not accrue under that statute; (2) the personal representative had no duty to invest funds of the estate before distribution; (3) prejudgment interest under Civil Code Section 3287 was inapplicable because there was no money judgment or contract; and (4) the beneficiary‚Äôs claim for interest was barred by the doctrine of laches.  Will which set forth testator’s intent in the event he predeceased his wife or they died at the same moment, but made no disposition in the event he outlived his wife, as he did, did not render the will ambiguous; existence of a disinheritance clause in the will did not prevent testators’ legal heirs from taking under the statutory rules of inheritance where testator had to be considered as having died intestate. Testator’s purported oral declaration of intent cannot be used to fill in omitted terms of the will. – filed December 5, 2011, Second District, Div. FourCite as 2011 S.O.S. 6501

Smith v. Cimmet

Oregon estate lacked capacity to sue California attorneys in California because that personal representative‚Äôs authority did not extend beyond Oregon.  (Code of Civil Procedure ¬ß1913(b)).  The Oregon personal representative was trying to bring a malpractice claim against California attorneys who were retained by the predecessor representative.  To bring the action in California, the Oregon personal representative would have to open an ancillary probate in California and then, if he was appointed as the ancillary representative, he would have the capacity to sue.  The court held that the Oregon personal representative had to be given the opportunity to open an ancillary probate and that under both California and Oregon law, the personal representative has standing to sue attorneys who were retained by a predecessor personal representative if those attorneys were hired to benefit the estate.

Estate of Giraldin

Filed September 26, 2011, Fourth District, Div. Three

After the settlor died, the trustee was surcharged for acts committed when the trust was revocable, but the court of appeal reversed and held that the trustee only owed duties to the settlor during that period and that therefore the beneficiaries could not maintain their claim. The court held that the trustee of a revocable trust has no duty to question the settlor’s capacity and that the beneficiaries have no say in how the trust is managed during that time. The court also held that when she accepted benefits under the trust, the settlor’s wife did not forfeit her claim that she had a community property interest in certain assets held in the trust. Assuming that the doctrine of spousal election applied, it was no impediment to the wife, because the settlor was not purporting to dispose of his wife’s community property and because his will did not require that she choose between sharing in his estate or retaining her share of the community property. 

Estate of Dito

Filed August 23, 2011, First District

Trusts and Estates

An earlier decision establishing surviving spouse’s status with respect to an estate did not result in res judicata relative to an action alleging surviving spouse’s financial elder abuse of decedent.

Marriage of Margulis

Fled August 11, 2011, Fourth District

Family Law

After non-managing spouse made prima facie showing that assets had disappeared, spouse who had control of community assets had burden of accounting for missing assets

Maxwell-Jolly v. Martin

(2011) 188 Cal. App. 4th 559, filed August 11, 2011

Trusts and Estates

The Department of Health Care Services is subject to a statute of limitations of three years after the death of the recipient of benefits to seek recovery against a trust holding the recipient’s assets.

Estate of Petter v. Commissioner of Internal Revenue

Court of Appeals, 9th Circuit 2011 No. 10-71854, August 4, 2011.

Taxation

Full recognition of charitable deduction that was increased based on audit was not precluded as a condition precedent.

Conservatorship of Buchenau

(2011) 196 Cal. App. 4th 1031, filed May 31, 2011

Trusts and Estates

Deposit from purchasers of real property was properly retained by conservator after the purchasers failed to comply with the terms of the escrow.

Dacey v. Taraday

(2011) 196 Cal. App. 4th 962, filed June 21, 2011

Trusts and Estates

A cause of action for breach of contract by an estate administrator was not barred by the statute of limitations applicable to claims against the decedent.

Andersen v. Hunt

(2011) 196 Cal. App. 4th 722, filed June 14, 2011

Trusts and Estates

The standard for a trustor’s capacity to execute a simple trust amendment is less stringent than for a more complex document.

Bellows v. Bellows

(2011) 196 Cal. App. 4th 505, filed June 9, 2011

Trusts and Estates

The need for further accounting was not precluded by accord and satisfaction between trust beneficiaries.

In re Marriage of Valli

(2011) 195 Cal. App. 4th 776, filed May 18, 2011

Family Law

When taken out by both spouses, a life insurance policy listing one spouse as the policy owner was that spouse’s separate property under form of title presumption.

Guardianship of Christian G.

(2011) 195 Cal. App. 4th 581, filed May 13, 2011

Family Law

When finding that father of minor subject of guardianship petition was unfit parent, the Probate court should have referred the case to child protective services.

Diaz v. Bukey

(2011) 195 Cal. App. 4th 315, filed May 10, 2011

Trusts and Estates

A trust beneficiary could not be compelled to arbitrate disputes under the trust when the beneficiary had not agreed to do so.

Callahan v. Gibson, Dunn & Crutcher LLP

(2011) 194 Cal. App. 4th 557

Trusts and Estates

Cause of action for legal malpractice based on allegedly faulty drafting of partnership agreement did not begin to run until circumstances threatening dissolution of partnership arose.

McMackin v Ehrheart

Filed April 8, 2011, Second District, Div. One

Trusts and Estates

A claim based on a decedent’s promise to leave her cohabitant a life estate in real property is governed by the one-year statute of limitations of Code of Civil Procedure Sec. 366.3; equitable estoppel doctrine may be applied to preclude a party from asserting a timeliness defense where that party’s wrongdoing has induced another to forbear filing suit.

Estate of Redfield

Filed April 5, 2011, Second District, Div. Three 
Cite as 2011 S.O.S. 1765

Trusts and Estates

Where probate court approved settlement of a will contest and dismissed with prejudice petitions by certain beneficiaries claiming that certain moneys were part of the decedent’s estate, those beneficiaries are barred by the doctrine of res judicata from relitigating whether those funds were part of the estate.

Leung v. Verdugo Hills Hospital

Filed March 23, 2011, Second District, Div. Four

Torts:

A release for consideration of one joint tortfeasor operates as a release of the joint and several liability of the other joint tortfeasors whose independent acts concurrently produced a single injury.

Banning Ranch Conservancy v. Superior Court (City of Newport Beach)

Filed March 22, 2011, Fourth District, Div. Three

Civil Procedure

Open-ended retainer agreement providing a structure for establishing future attorney-client relationships on an “as-requested” basis did not create a contractual ongoing attorney-client relationship.

Estate of Bartsch

Filed March 22, 2011, First District, Div. One

Trusts and Estates

Son claiming a right to inherit his father’s estate as an omitted heir had standing to challenge probate court’s interim award of attorneys’ fees and costs to executor because such an award would place son at a financial disadvantage by diminishing the estate should son prevail in the will contest. Personal representatives or executors who are also beneficiaries are not incapable of participating “as a party to assist the court” under Probate Code Sec. 11704(b).

Estate of Stoker

Filed March 3, 2011, Second District, Div. Six

Trusts and Estates

Where petition to probate will had the practical effect of challenging an earlier trust, filing of such petition was an “action to contest the trust” within the meaning of Probate Code Sec. 16061, which requires that such an action be brought within 120 days following service of notice by the trustee. Will was dictated and signed by decedent and handwritten by another person–but was defective in form because it contained no witnesses’ signatures. Trial court did not err in admitting it to probate under Sec. 6110(c)(2) based on clear and convincing evidence of decedent’s intent in the form of testimony by two witnesses who saw him sign it. Public policy in favor of validating wills that reflect decedents’ intent supports retroactive application of Sec. 6110(c)(2) to wills executed before its effective date. Lack of testamentary language, use of the word will, or reference to death did not preclude finding that document was intended by decedent to be his will.

Bonfigli v. Strachan

Filed February 23, 2011, First District, Div. Four

Real Property

A special power of attorney coupled with an interest in property is terminated upon extinguishment of the interest; erroneous jury instruction as to this principle was prejudicial. Plaintiffs were not required to offer evidence of mental suffering to support their claim of financial elder abuse.

Baccei v. United States

Filed February 16, 2011, United States Court of Appeals, Ninth Circuit

Taxation

Taxpayer could not rely on substantial compliance doctrine to excuse his failure to properly request an extension of time to pay estate tax where he failed to state the period of extension required because such information was essential for IRS to assess reasonableness of request; failure of IRS to notify taxpayer that his extension request was incomplete was insufficient to support claim of equitable estoppel. Taxpayer’s reliance on an accountant to obtain an extension did not constitute “reasonable cause” for his failure to pay estate taxes in a timely manner.

Mathis v. Glover

Filed February 1, 2011, United States Court of Appeals, Ninth Circuit

Individual Rights

Public administrator’s failure to give notice and an opportunity to respond to family of decedent before taking items from decedent’s house, absent extraordinary circumstances, violated due process. Official was not entitled to qualified immunity because the law was clearly settled in this area.

Kucker v. Kucker

Filed January 26, 2011, Second District, Div. Six

Trusts and Estates

Civil Code Sec. 1624(a)(7), cannot be construed as applying to the transfer of shares of stock to a trust; plain meaning of the words of the statute manifests a legislative intent to limit the statute’s application to agreements to loan money or extend credit made by persons in the business of loaning money or extending credit. No California authority invalidates a transfer of shares of stock to a trust because a general assignment of personal property did not identify the shares.

In re Marriage of Fossum

Filed January 28, 2011, Second District, Div. One

Family Law

Form-of-title presumption simply does not apply in cases in which it conflicts with the presumption that one spouse has exerted undue influence over the other. Undue-influence presumption applied where wife testified that she freely and voluntarily executed a quitclaim deed in favor of husband to obtain a more favorable interest rate on a loan to refinance based on his promise to restore her class=”anchor” name to the title once the refinance was complete. Trial court lacks discretion to deny attorney fees if aggrieved spouse shows a breach of fiduciary duty as to the management and control of community property that does not rise to the level of fraud, malice, or oppression.

Conservatorship of McQueen

Filed January 14, 2011, First District, Div. Four

Trusts and Estates

In suit for financial abuse of an elderly person, trial court correctly applied collateral source rule by instructing jury that government benefits received by victim based on her long-standing disabilities and financial need could not be considered in awarding damages.


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