Estate of Giraldin

In Estate of Giraldin, (Dec. 20, 2012, S197694) ___ Cal. 4th ___ [2012 Cal.  Lexis 11381], the California Supreme Court discussed the fiduciary duty of the non-settlor, trustee, to only the settlor, during the settlor’s lifetime. The Court ruled that upon the death of the settlor, the trust beneficiaries’ interests vest and therefore, the trust beneficiaries then have standing to sue the trustee for breach of fiduciary duty to the settlor but not for a breach of fiduciary duty to themselves because none existed.

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

 Copyright © 2013 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\2013.01.15 Estate of William A Giraldin.docx 

Thorpe v. Reed: Do California Probate Code Sections 15642 and 17206 Provide Authority for a Successor Trustee to be Compensated When the Trust Prohibits Compensation?

Thorpe v. Reed, (Dec. 13, 2012, H037330), ___Cal.App.4th___ [2012 Cal.App. Lexis 1272], involved provisions of a special needs trust which prohibited trustee fees to a successor trustee.

Reed was injured in two different automobile v. individual accidents. A special needs trust was established to hold a home and funds from the resulting litigation.

Ultimately, the trustee was replaced by the public guardian as temporary trustee. The public guardian was replaced by a professional fiduciary who was appointed temporary successor trustee. After a series of hearings and continuances, with the family, the trust beneficiary, and the public guardian all suggesting that the conservatorship was no longer necessary and that a family member could act as trustee, all opposed by the professional fiduciary, the trial court appointed the professional fiduciary as permanent trustee. The trial court cited California Probate Code sections 15642, subdivision (e), and 17206 as authority for the court to award fees in spite of the specific prohibition of fees to a successor trustee in the trust, and the trial court awarded fees to the successor trustee – the professional fiduciary. 

The Court of Appeal, Sixth Appellate District, reversed the trial court and held that there was no authority for a court to award fees to a successor trustee who accepted appointment as trustee and acted in that capacity, but could have declined the appointment, where the trust itself restricted the amount to be paid or prohibited it. The Court pointed out that the trial court’s ruling was contrary to the plain language of California Probate Code section 15680, which limits trustee compensation to the amount fixed by the trust. 

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

Copyright © 2013 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\2012.12.28 Thorpe v. Reed.docx