Trusts & Estates Section | November 2019 Legal Updates

Levin v. Winston-Levin, 39 Cal. App. 5th 1025 (filed September 13, 2019)

Trustor Robert Levin had amended his Trust on several occasions, most recently in 2008, 2011, and 2012, before passing away in 2015.  Robert’s daughter, Elizabeth, contested the 2008 and 2012 Amendments, alleging that Robert lacked capacity to execute these amendments and that he was unduly influenced by his wife, Debra (Elizabeth’s stepmother); Elizabeth also brought claims for an order compelling the return of trust property and double damages under Probate Code §§ 850 & 859, as well as financial elder abuse, breach of fiduciary duty, breach of contract, and intentional interference with expected inheritance.  After noting that it was “to say the least, not impressed with either side,” the trial court found that the circumstances of the 2012 Amendment triggered a presumption of undue influence, which Debra failed to rebut, but upheld the validity of the 2008 Amendment.  The court ordered certain real property returned to the Trust, and invalidated the 2011 and 2012 Amendments; however, the trial court rejected Elizabeth’s request for double damages under § 859, finding that Debra’s conduct was not sufficiently egregious to warrant this penalty.

Elizabeth appealed this ruling on a number of grounds, including the trial court’s rejection of her § 859 double damages claim, arguing that the finding of undue influence compelled a finding of financial elder abuse, which, in turn, compelled an award of double damages, per the language of § 859.  The Court of Appeal affirmed the trial court’s ruling, holding that a finding of bad faith is required for double damages under § 859, and there is no automatic trigger of this provision upon a finding of undue influence of an elder without also finding bad faith.

Estate of Holdaway, 40 Cal. App. 5th 1049 (filed October 7, 2019)

Everett filed a timely creditor’s claim against the estate of Richard Holdaway, tolling the statute of limitations for actions against a decedent under C.C.P. § 366.2.  Richard died in 2013, and the creditor’s claim was filed in 2014, on the second to last day before the statutory deadline.  Everett also filed a petition for probate.  After a number of continuances of the petition for probate, in 2015, the trial court ultimately dismissed this petition without prejudice for failure to prosecute.  Everett then renewed her petition for probate in December 2015, and in May 2016, Richard’s son filed a competing petition for probate.  The trial court granted Richard’s son’s competing petition in October 2016, naming the son as executor of Richard’s estate, and it dismissed Everett’s petition for probate.  In March 2017, Richard’s son rejected Everett’s creditor’s claim, and Everett filed a “Complaint for Damages on Rejected Creditor’s Claim” in May 2017.  The trial court sustained the son’s demurrer without leave to amend, finding that Everett’s claim was time barred.  The Court of Appeal reversed, finding that because Everett filed her creditor’s claim in a timely manner, the statute of limitations was tolled until a formal rejection, even where that rejection does not take place for a number of years.  The Court of Appeal rejected the son’s argument that the trial court’s dismissal of Everett’s petition for probate restarted the clock, as this was not tantamount to a rejection of her creditor’s claim.

Assembly Bill 473 (effective January 1, 2020)

Amends Probate Code § 13100, to increase the specified dollar amount for a small estate to qualify for disposition without a full probate administration, from $150,000 to $166,250.  Additionally, the bill will increase the dollar amounts for the limit for a surviving spouse to file a set-aside petition, from $20,000 to $85,900.  It will also require the Judicial Council to revise these amounts every three years, starting April 1, 2022.

By | 2019-11-14T14:11:25-08:00 November 14th, 2019|Legal Updates|Comments Off on Trusts & Estates Section | November 2019 Legal Updates