Trusts and Estates

Estate of Eimers

Cite as B295609
Filed May 15, 2020
Second District, Div. Eight

By Golnaz Yazdchi
Sheppard Mullin Richter & Hampton LLP
https://www.sheppardmullin.com

Headnote:  Powers of Appointment – Requirements for Exercise

Summary:  A court may not amend or reform a will to include a specific reference to a power of appointment in order to preserve the validity of the gift.

Decedent died leaving a holographic will.  In his will, decedent devised his shares of the Norbert Theodore Eimers Family Trust to Charles J. Saletta and Caryn Saletta.  Decedent was a beneficiary of the trust and held a testamentary power of appointment.  The trust instrument allowed decedent to appoint his share of the trust only by way of a will specifically referring to, and exercising the power of appointment.  Following decedent’s death, the Salettas opened a probate, and filed a petition to amend and reform the will to give effect to the power of appointment because the will did not specifically refer to the power of appointment.  In a separate action, the trustee of the trust sought instructions on whether he could distribute decedent’s share of the trust to the Salettas, and in that action the court held that the decedent’s will did not comply with the trust’s specific reference requirement.  The trustee thereafter demurred to the Salettas’ probate action, which the court sustained without leave to amend.  This appeal in the probate action followed.     

Held: Affirmed.  A court cannot reform a will to create a specific reference to a power of appointment where the creating instrument required such a reference, because to do so would nullify statutory requirements mandating that some exercises of powers of appointment specifically refer to the power.  It is clear that the decedent intended to exercise his power of appointment to leave his trust shares to the Salettas, but the gift can be given no effect because he did not include a specific reference to his power of appointment in his will.  Further, the statutory definition of “interested person” is sufficiently broad, under the unusual circumstances of this case, to confer standing to object to the will reformation action on the trustee of the trust, as the only person who could represent the interests of decedent’s parents, who had created the power of appointment.

https://www.courts.ca.gov/opinions/documents/B295609.PDF

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