Demurrer, Summary Judgment, Parol Evidence–In Probate???

Some of you went into Estate Planning and Probate to avoid Civil Procedure and Evidence rules; but as the facts and decision in Estate of Gardner (2010), Cal.App.4th makes clear, demurrers, summary judgment, and parole evidence are a continuing part of even a Probate practitioner’s life.

James Gardner died leaving his mother, sister, ex-wives, and children.  That probably wouldn’t matter except that prior to his death, James recovered $2.5 million as settlement for a personal injury lawsuit.  He deposited eighty percent in two separate brokerage accounts; $1,008,661.80 with Atlas Funds and $1,008,661.80 with Wells Fargo Investments, L.L.C.

The Atlas account was set-up as “Pay-On-Death” (POD) to James’ mother and sister, equally.  Wells Fargo was to set-up the account in the same manner, but the paperwork to establish the POD was never executed.  James was informed that an ex-wife was employed at Wells Fargo.  He was “concerned” and “elected to withdraw the entirety of the funds . . . and transfer them to Wachovia Securities.”  Two months later, he executed documents and electronically transferred the Atlas account to Wachovia.  Wachovia prepared an “Application for Registration of Account in Beneficiary Form, Transfer on Death Direction” to his mother and sister.  James died before executing this application.

Appellant, mother, in her P.C. §850 Petition, claims in the alternative, that she and decedent’s sister are rightful owners of the funds because they were P.O.D. or Totten Trust accounts (P.C. §550 et seq) upon deposit; or, that an “express oral trust” was created upon deposit at Wachovia (P.C. §15201 et seq).

The trial court sustained objectors’ demurrer to the First Amended Complaint without leave to amend.

Appellant, on appeal, contended that “decedent intended to give the money to her; and second, that decedent “created an express oral trust’ by asking Wachovia to hold the funds for his mother and sister.” 

The appellate court looked at non-probate transfers (P.C. §5000 et.seq.) and the Uniform TOD (Transfer on Death) Security Registration Act “UTSR Act” (P.C. §5500 et.seq.).  The Appellate Court disagreed with Appellant that parol evidence could be used, by itself, to show an account was registered in beneficiary form.  “The parol evidence rule . . . generally prohibits the introduction of any extrinsic evidence, whether oral or written, to vary or add to the terms of an integrated written instrument.  The rule does not, however, prohibit the introduction of extrinsic evidence to explain the meaning of a written contract. . .”
In this case, the court said parol evidence could be used to “explain the meaning of a registration, but it cannot substitute for the actual registration. . .”

Alternatively, Appellant contended that the POD terms carried-over from Atlas to Wachovia.  P.C. §5508 allows beneficiary accounts, but does not require an entity to provide for it.  Thus, the court said Wachovia could allow for beneficiary accounts and that the Atlas registration was sufficient to carry-over a beneficiary registration.  This, the appellate court finds, is a sufficient issue to support requiring a trial.

With regard to the “Oral Trust” the Appellate Court said “an oral trust in personal property is valid and may be proved by parol evidence.”  Three elements are required: “a trust res, the manifestation of a trust interest, and a proper trust purpose” (P.C. §15201-15203).  P.C. §15207 requires clear and convincing evidence to prove-up an oral trust.  Appellant’s pleading that decedent “orally declared” the trust to Wachovia was sufficient to plead trust intent.  That these facts were also pled to support a POD account is okay.  The same facts are often used to plead alternative causes of action.

The Appellate Court reversed the trial court and found sufficient pleading of the facts existed to overcome a demurrer.

Mark your calendar for the upcoming Long Beach Trust, Estate Planning and Probate Brown Bag Luncheon:

Thursday, April 28, 2011, Michael Trainotti, Esq., will be sharing his thoughts on Estate Tax and Related Tax Law Changes for 2011-2012 (and 2010?)  In addition, Judge Paul will give special recognition to those who have so faithfully given of their time and expertise to volunteer for the Pro Per Guardianship Panel.

We meet at the Long Beach Superior Court in Dept. G (on the 5th floor).  There is no charge for the meeting.

                _________________________________________________

                John T. Anderson, Section Chair

                Certified Specialist in Probate, Trust and Estate Planning

                by the California State Bar Board of Legal Specialization

Copyright © 2011 by John T. Anderson

All articles by John T. Anderson may be copied for personal use, only. All articles or outlines from others may be used only with their personal authorization. Any approval is for personal use, only, and for non-commercial purposes.

File Location: C:\Users\John's LT\Documents\Work\Website\Articles for Website\Word Version of Articles From Lisa\2011.02.23 Civ Pro in probate.docx

Heggstad and its Prodigy

Probate, Trust and Estate Planning Tidbits.
by John T. Anderson, Chairman
Certified Specialist in Estate Planning, Trust
and Probate Law by the State Bar of California,
Board of Legal Specialization

Heggstad and its Prodigy

The 2d Appellate District out of Ventura County has taken Estate of Heggstad (1993) 16 Cal.App.4th 943 another step.  Heggstad itself gave a great tool to Trustees and those connected with the administration of a trust.  There have been differences between courts in the application of Heggstad beyond the absolute facts of that case.

Megan Kucker (“Megan”) and Bonnie Alexander (“Bonnie”) are successor Trustees of the Mona S. Berkowitz Trust (“the Trust”).  They filed a Probate Code §850 petition [850(a)(3)(B)] to confirm that shares of stock which were not properly registered in the Trust were Trust Assets, not by virtue of listing on Schedule “A”, but by virtue of a general property assignment.  On June 29, 2009, the Trust and assignment of “all of my right, title, and interest in all property owned by me, both real and personal and wherever located” were executed.  On October 29, 2009, an Amendment and Restatement of Trust were executed, as well as an assignment of specific shares of stock, not including the shares at issue.

Trustor died in November of 2009.  In February 2010, Megan and Bonnie filed their Petition to confirm the shares of stock, which were not included in the October 29, 2009 Assignment, were, in fact, assets of the Trust.

Appellants set forth that the shares were not in the Trust’s Brokerage account; the share certificates had been lost; and by virtue of the General Assignment, Trustor’s intent was to include the disputed shares in the Trust.

The Trial Court agreed with Petitioners that under P.C. §15207, an oral trust can be created “if clear and convincing evidence in presented;” however, that §15207 “must be read in conjunctions with Civil Code §1624(a)(7) requiring a writing specifically describing property in excess of $100,000.

The appellate court found that the application of CC§1624(a)(7) was “misplaced.”  It applies to “a contract, promise, undertaking, or commitment to loan money . . . by a person engaged in the business of lending . . ..”

“The Probate Court erred by not ruling that the General Assignment was effective to transfer the Medco shares to the trust.”

To satisfy the Statute of Frauds in Civ. Code §1624, a description of real property was required.  But, in this case, the transfer was not of real property and thus “the Statute of Frauds does not apply . . ..”  “There is no California authority invalidating a transfer of shares of stock to a trust because a general assignment of personal property did not identify the shares.  Nor should there be.”

The court cited the CEB Practice Guide on Revocable Trusts that assignments of personal property by general assignment to the trust “so that a Heggstad Petition §850(a)(3) can be used to capture any later acquired items not titled in the nature of the trust” or any “overlooked items.”

Citing the Heggstad case, the court noted the reference in that case to the Practice Guides and that they were “not compelling authority , they are persuasive when there is an absence of precedent.”  In Heggstad, the court concluded, regarding the transfer of real property to the trust, where no deed had been executed, “that a transfer of title is not necessary when the Settlor declares himself Trustee in his own property.”  The Heggstad court further “stated that the probate court’s jurisdiction over trusts includes the ‘court’s inherit power to decide all incidental issues necessary to carry-out its express powers to supervise the administration of the Trust.’”

The Appellate Court concluded that the General Assignment sufficiently showed Trustor’s intent to hold the shares owned by him as Trustee of the Trust.

Query: If you own shares of stock both in a trust and out of a trust, must you do something affirmative to set forth your intent to EXCLUDE shares from the trust?  Perhaps the trust will need to say “EXCEPT for those shares or other assets set forth on Schedule ‘B’?”  But then, you could have just transferred the assets in the first place; or listed the intended shares on Schedule “A.”
                                   
Mark your calendar for the upcoming Long Beach Trust, Estate Planning and Probate Brown Bag Luncheon:

Thursday, April 28, 2011, Michael Trainotti, Esq., will be sharing his thoughts on Estate Tax and Related Tax Law Changes for 2011-2012 (and 2010?)  In addition, Judge Paul will give special recognition to those who have so faithfully given of their time and expertise to volunteer for the Pro Per Guardianship Panel.

We meet at the Long Beach Superior Court in Dept. G (on the 5th floor).  There is no charge for the meeting.


                _________________________________________________
                John T. Anderson, Section Chair
                Certified Specialist in Probate, Trust and Estate Planning
                by the California State Bar Board of Legal Specialization

Copyright © 2011 by John T. Anderson

All articles by John T. Anderson may be copied for personal use, only. All articles or outlines from others may be used only with their personal authorization. Any approval is for personal use, only, and for non-commercial purposes.

File Location: C:\Users\John's LT\Documents\Work\Website\Articles for Website\Word Version of Articles From Lisa\2011.02.09  Heggstad Revisited.docx

Helpful Hints from the Probate Attorney

Probate, Trust and Estate Planning Tidbits.
by John T. Anderson, Chairman
Certified Specialist in Estate Planning, Trust
and Probate Law by the State Bar of California,
Board of Legal Specialization

Helpful Hints from the Probate Attorney

The Los Angeles County Bar Association, Probate and Estate Section sponsored a meeting with the Los Angeles County Probate Attorneys and Examiners entitled “Help Us Help You.”

All Room 258 Probate Attorneys and Examiners assigned to Central were present.  Commentary is applicable to Central Court and may be handled differently in the Branch Courts.

ExParte

Make sure pleadings are complete.  Have ALL documents together for presentation.  The Declaration of Notice must be complete and explain the urgency.  Verify it is signed under Penalty of Perjury.

Exigent circumstances/irreparable harm must be shown–put it front and center.  Include all necessary facts and don’t expect to get a chance to speak because you won’t.

LASC Ch. 10 §10.8 discusses the time of Ex Partes, place, pay fees, bring notice, some are drop-offs (including Nunc Pro Tuncs §10.19 to correct clerical errors, only), temporary appointments. 

Calif Rule 7.55 Special Notice Requirements (CRC 3.1200, 3.1206) Civil Rules that apply to Exparte: Form, content, affirmative showings required, prior applications and results.

CRC 3.1204 Notice Requirements and Content.  Did you ascertain whether the opposition will appear.

CRC 2.306 Notice by email

Supplements

Supplements vs. Amendments (LSCR 10.18, 7.53, 7.103, 7.104) There is a difference.  A supplement answers a question which was raised.  An amendment changes something or add/subtracts something and requires a hearing date.

Verify Supplements and serve on all parties

CRC 7.153
CRC 7.104 Supplement must be signed by one of the parties.  The court may accept a Supplement signed by the attorney if the attorney has personal knowledge.

Do not add or change relief sought.  Supplements must be filed with file stamp before going to the Probate Attorney.  Do not attach “stand-alone” documents to other documents or a supplement or it will not be entered as a separate document.

When responding to Probate Notes, do not respond in narrative.  Concisely answer by reference to each separate note by its letter.

If a change alters the Schedules, Summary of Account, or Fees, all parties are entitled to notice and the matter will likely be continued.

Fax Filing

Fax Filing is only accepted from 3rd parties (newspaper filings, Bonding Companies, etc.); not pleadings . . . (nothing from us).

Objections

Verify pleadings.  Make certain who gets service.  Pay the filing fee.  Do not combine Objections with a Petition for Affirmative Relief (file it separately).  Opposition to a Motion must be a separate pleading from Objections.

Email

Email may be your only way to communicate with staff.  They have a crushing caseload.

Email Tips (aka Probate Attorney Complaints):

The court website has “email parameters” to follow:

1.    Put the Case No and Hearing Date on the Reference Line so they see it first.
2.    One email per matter–not a twitter account or stream of consciousness.
3.    Don’t be annoying.
4.    There are now seven times per day (9:30, 11:10. 2:00, 3:10, 4:30, 6:10, and 8:40) that the notes are updated on the web.  They are also updated twice on the weekend.
5.    After the day’s hearing, the notes go off the computer.  A continued matter will not come up for them again until about 10 days before the new hearing.
6.    Do not email the Probate Attorney to get the status on your order.  The clearing attorney may not be the one processing your order.  Contact the Order Clerk in Room 258.
7.    Do not cc: Sandra Riley or Brenda Penny on your emails.
8.    Do not identify yourself as the Attorney for Petitioner.  Identify yourself as the Attorney for Petitioner on the Accounting or...
9.    Do not email that you are filing a supplement.  Their opinion is, “Good, then you got the Notes.”

Examiners

Examiners review Petitions for Temporary or Permanent Conservatorships and Petitions for Probate.  They will not continue status hearings unless it is one to prove-up or file something.  If you have filed the necessary matter then you can let them know the hearing date.
If the notes say “recommend continuance” but no date is given, unless you email to indicate a date to continue to, the court may “deny without prejudice.”  It is just a comment, not a recommendation to the court.  It is not a continuance.  If a date is given, that date will be the continuance date.  If you would like a different date, email in advance of the hearing.

General Comments

If there is going to be a Settlement, put the salient terms in your pleadings and the benefit of the settlement to the estate.

If there are related matters, note them in your pleadings.

CRC 7.702 must be complied with in Conservatorship Fee requests.

If it is the day before the hearing and you have no Probate Notes, check with Room 258 to verify your matter is actually on calendar.  They will be working on the notes.  In the afternoon, if there are still no notes, email them.

Calendar Setting Dates:

Petition for Probate:         Set for 4 weeks
Petition to Confirm Sale:    Set for 4 weeks

All other matters vary; but as of now, for calendar settings:
D-5    3 months
D-9    3.5 months
D-11    3.5 months
                           
Mark your calendar for the upcoming Long Beach Trust, Estate Planning and Probate Brown Bag Luncheon:

Thursday, April 28, 2011, Michael Trainotti, Esq., will be sharing his thoughts on Estate Tax and Related Tax Law Changes for 2011-2012 (and 2010?)

We meet at the Long Beach Superior Court in Dept. G (on the 5th floor).  There is no charge for the meeting.

                ________________________________________________
                John T. Anderson, Section Chair
                Certified Specialist in Probate, Trust and Estate Planning
                by the California State Bar Board of Legal Specialization

Copyright © 2011 by John T. Anderson

All articles by John T. Anderson may be copied for personal use, only. All articles or outlines from others may be used only with their personal authorization. Any approval is for personal use, only, and for non-commercial purposes.

File Location: C:\Users\John's LT\Documents\Work\Website\Articles for Website\Word Version of Articles From Lisa\2011.02.04  Help Us Help You.docx