Probate Trusts

[11/17] 1680 Prop. Trust v. Newman Trust
In plaintiffs' suit against the defendant-Newman Trust for breach of fiduciary duty based on fraud, summary judgment for defendant is affirmed as the Code of Civ. Proc. section 366.2 period of limitations is applicable to fraud claims based on statements of the decedent on behalf of a trust of which he was trustor and trustee, even though the action is against the successor trustee.

[11/09] King v. Johnston
In plaintiff's suit against defendant alleging undue influence on the trustee to breach a trust of which plaintiff was a beneficiary, judgment in favor of defendant is reversed and remanded where: 1) the court erred in determining that plaintiff did not have standing to sue defendant for her role as a third-party participant in a trustee's breach; 2) the trial court erred in failing to consider and make the necessary findings as to whether plaintiff could recover from defendant under a theory that, after the trustee's death, defendant became a trustee de son tort, and thus had duties to the trust beneficiaries, which she breached; and 3) plaintiff may recover from defendant for defendant's breach of trust after the trustee's death.

[10/29] Johnson v. Greenelsh
In proceedings involving an arbitration petition by one co-trustee of a family trust and plaintiff-co-trustee's petition to enforce a no contest clause, appellate court's judgment against defendant-co-trustee is reversed as a challenge to a surviving spouse's mental capacity to transfer trust assets and appoint a successor trustee did not violate the no contest clause in a family trust. A proceeding contesting a settlor's mental competence to exercise rights under a trust does not amount to an attack on the trust itself, unless it seeks to thwart the estate plan established by the trust.

[10/27] Rands v. Rands
Probate court's order determining that settlor's revocation of a trust is ineffective due to his lack of capacity is affirmed as the certifications of mental competence are insufficient because neither physician who found mental competence was aware of the earlier certifications of mental incompetence.

[10/16] Nordwind v. Rowland
In an action for legal malpractice, summary judgment for defendants is affirmed where plaintiffs failed to show actual injury because, under German law, they would have only been entitled to 50% of the subject inheritance regardless of any malpractice on the part of their counsel.

[10/08] Estate of Farnam v. Comm'r. of Int'l. Rev.
In a taxpayer's appeal from the tax court's decision disallowing a claimed deduction, the order is affirmed where an "interest" in a corporation under I.R.C. section 2057(a) is necessarily limited to an equity or ownership interest, and does not include a creditor's "interest" in an unsecured debt owed by the corporation.

[10/01] US v. Flowers
In an action by the U.S. seeking reformation of a trust provision that sought to pass part of an estate to a family member free and clear of tax obligations, summary judgment for defendants is affirmed where the government was unable to demonstrate any entitlement to the disputed money by virtue of its contract with defendant establishing a payment plan for past due taxes.

[09/29] Estate of Pryor
In an appeal involving presumptive disqualification of a care custodian from receiving a donative transfer from a dependent or elder adult, trial court's judgment against the daughter of comedian Richard Pryor and in favor of stepmother is affirmed as there is no support in the language of section 21351(a) or in the legislative history which would make the spousal exception to the presumption of invalidity unavailable to a spouse who allegedly persuaded the transferor to marry through undue influence or fraud.

[09/29] Cook v. Cook
Probate court's finding that beneficiary's pleading violated the no-contest clause provision of the Trust, thereby causing his disinheritance pursuant to the Trust terms is affirmed as beneficiary's argument that his debt is unenforceable violates the trust's no-contest provision.

[09/17] E. Shawnee Tribe of Oklahoma v. US
In Indian tribe's suit against the United States alleging breach of fiduciary duty and other duties as trustee of property and other assets owned by the tribe, Court of Federal Claims' dismissal of the case without prejudice is reversed and remanded as 28 U.S.C. section 1500 is inapplicable because the present complaint and an earlier complaint filed in a district court seek different relief.

[09/17] Segal v. Fifth Third Bank, N.A.
District court's dismissal of plaintiff-trust accounts beneficiary's class action against bank and its holding company on state-law claims of breach of fiduciary duty and breach of contract is affirmed as the Securities Litigation Uniform Standards Act of 1998 bars plaintiff's claims.

[09/11] Powell v. Comm'r. of Int'l. Rev.
In an appeal from a tax court's post-trial decision to adopt the Commissioner of Internal Revenue's computation of the taxpayer's estate tax deficiency rather than the taxpayer's own computation, the order is affirmed where: 1) the tax court did not abuse its discretion in computing the amount of the deficiency; and 2) the tax court did not abuse its discretion by adopting the Commissioner's Rule 155 computation.

[09/09] Estate of Lensch
Trial court's judgment denying appellants' petition to determine survival and to determine persons entitled to distribution of the estate of their grandmother is reversed and remanded where: 1) although the trial court was correct in finding that the will contained no survivorship requirement, it erred in denying appellants' petition on this basis as it did not understand the legal consequences of the lack of survivorship requirement in the will; and 2) the trial court should have held an evidentiary hearing on the issue of testator's son's time of death.

[08/19] Salter v. Lerner
In an appeal from a probate court's determination that a petition plaintiffs proposed to file against defendant seeking information regarding his conduct as trustee of a trust would not violate the no contest provision of the trust agreement, the order is affirmed where the proposed petition did not seek to do more than enforce defendant's nonwaivable fiduciary duty under Probate Code section 16060.

[08/06] Buchel-Ruegsegger v. Buchel
In a dispute involving a transfer of money from Switzerland to Wisconsin, district court judgment is vacated for lack of subject-matter jurisdiction where defendant-son is a United States citizen and plaintiff-mother and the decedent were United States citizens as well as citizens of foreign states, and thus plaintiff is unable to invoke subject-matter jurisdiction as a citizen of a foreign state under 28 U.S.C. sec. 1332(a)(2).

[08/05] Drummond v. Desmarais
In a malicious prosecution action against plaintiffs' former attorney, judgment dismissing the action is affirmed where: 1) the trial court did not err in granting the special motion to strike the action for malicious prosecution based upon defendant's probate petition for fees, as plaintiffs cannot establish a favorable termination of the matter on the merits; and 2) the court did not err in dismissing plaintiffs' malicious prosecution suit based on defendant's own malicious prosecution complaint against them because, although the evidence supports a finding that defendant acted maliciously and without probable cause in suing his clients, defendant's voluntary dismissal of the suit was a technical disposition and not a termination on the merits in plaintiffs' favor as required.

[07/28] Negrete v. Becerra
Probate court judgment ordering plaintiff to pay monetary sanctions to the court and attorney's fees to the court appointed attorney for defendant is reversed where the orders are legally erroneous, unsupported by the record, and a prejudicial abuse of discretion as the court failed to follow proper procedures in giving notice of the proposed sanctions and in awarding them for the express or implied reasons disclosed by the record.

[07/09] Chambers v. Money
Probate court order denying plaintiff's petition to be declared the sole heir by intestacy and determining instead that defendant was the deceased party's natural son and sole heir is reversed and remanded where the court incorrectly applied a preponderance of the evidence standard of proof instead of the clear and convincing evidence standard as required under Probate Code sec. 6453 (b) and Family Code sec. 7630 (c).

[06/08] Cory v. Toscano
Trial court judgment that a proposed petition to determine the terms of the trust did not violate the trust's no contest clause is affirmed where the handwritten notations on the trust instrument were an attempt to amend the trust and were not part of the original trust agreement, and thus a challenge to its validity is not a contest under Probate Code sec. 21305(a)(3).

[06/05] Ditta v. Conte
In a breach of fiduciary duty action involving the removal of a trustee of an an inter vivos trust, court of appeals' judgment holding that the case was time-barred is reversed and remanded where a statutory limitations period is applicable to suits seeking damages for breach of fiduciary duty but no statute of limitations period restricts a court's discretion to remove a trustee.

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