Category: Trust Administration

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Another Shiner – Court Confirms Hefty Fee Award to California Attorney General in Breach of Charitable Trust Action

In California, the Attorney General oversees charitable trusts. This responsibility includes bringing legal actions against trustees who breach their fiduciary duties. Government Code section 12598 provides that the Attorney General is entitled to recover from a defendant all reasonable attorney’s fees and actual costs incurred in an action to enforce a charitable trust. But what … Continue Reading

Mind Your Notice in California – Even Remote Contingent Beneficiaries May Need to Be Served

It’s unremarkable that California courts require that notice be given to affected beneficiaries in trust and probate proceedings.  After all, the Fourteenth Amendment guarantees that no person will be deprived of life, liberty, or property without due process.  While contingent beneficiaries may not have received an inheritance yet, they may someday and so should know … Continue Reading

Openness and Transparency Help Avoid Trust Disputes – An Interview with Tracy Potts

Tracy M. Potts has nearly three decades of experience in California with estate planning, administration and litigation.  A Texas native, she earned her law degree from Southern Methodist University School of Law.  Her leadership experience includes chairing the Executive Committee of the State Bar of California, Trusts and Estates Section, as well as the Sacramento … Continue Reading

Put It on My Tab – When Is a Lifetime Gift in California an Advancement Against Inheritance?

A primary purpose of estate planning is to determine what a child will inherit (if anything) upon a parent’s death.  But what about a gift given during the parent’s life?  Is it an advance on the child’s inheritance, like putting it on the child’s tab until the trust is cashed out?  Or is the gift … Continue Reading

California Trustee Must Be Careful in Seeking Release from Beneficiary

Can a California trustee require a beneficiary to sign a release in order to get a distribution from a trust?  A question like this appeared recently on the AVVO “Free Q&A” page and makes for a perfect blog topic. Trustees understandably want to wrap up trust administration without having to worry about being sued by … Continue Reading

The Ninth Circuit Sounds A Wake Up Call – Federal Law Permits Class Action Claims Against Trustees

While institutional trustees may have once slept soundly considering themselves immune from class action lawsuits relating to the purchase or sale of securities on behalf of a trust, the Ninth Circuit’s recent ruling in Banks v. Northern Trust Corp. (9th Cir. 2019) 929 F.3d 1046, sounds a rousing wake up call for every trustee who … Continue Reading

How Do I Evaluate and Dispute a California Trustee’s Fee?

This blog post views a trustee’s fee from the beneficiary’s perspective.  Under California law, a trustee generally can set his or her own fee and collect it without prior disclosure to the beneficiaries.  What can a beneficiary, who sees a hand reaching too greedily in the trust cookie jar, do in response? We discussed best practices for … Continue Reading

Trustees Must Terminate California Trust if Terms Compel Distribution

Are six sibling co-trustees too many cooks in the kitchen? Many California trust disputes arise from disagreements among sibling co-trustees over how to administer Mom and Dad’s trust after the parents have passed. They all have a strong sense of what Mom and Dad wanted, but they don’t agree on what it was.  Thus, trust … Continue Reading

Free Rider No More — When Can a California Trust Beneficiary Shift Legal Fees to Other Beneficiaries?

American courts (including our California state courts), in contrast to courts in England, do not typically award attorneys’ fees to a lawsuit’s “victor.”  There are, of course, exceptions to this so-called “American Rule.”  Among them is the “common fund” exception, which provides that one who incurs fees winning a lawsuit that creates a fund for … Continue Reading

Litigators Should Be Collaborators, Not Lone Rangers

Trust and estate litigation attorneys are “trusted advisors.”  Like estate planning attorneys and other professionals who help clients with wealth management, we are fixers who assist clients with navigating conflict relating to a trust or estate.  While we spar in the probate departments of the Superior Court of California, at the end of the day … Continue Reading

Trustee Fees in California – Tips for Family Member Trustees

What is a reasonable trustee’s fee in California for a family member who acts as trustee?  We see a high degree of conflict over this issue even when the amount of the claimed fee is small compared to value of the trust estate.  Our blog analytics show that our post of a few years ago … Continue Reading

California Court Can Apply Impossibility Doctrine

What happens when the settlor (i.e., creator) of a trust imposes a condition precedent on receipt of a distribution from the trust, but the condition cannot be met because the circumstances have changed?  Is the beneficiary out of luck for reasons beyond his or her control? The First District Court of Appeal took up this … Continue Reading

California Courts Can Excuse Trustee Who Acts in Good Faith

A California trustee can be excused from liability for breaches of trust if a judge determines that it would be equitable to do so. We see many situations where a family member trustee strays from the requirements of the trust instrument. Still, if the trustee does not favor himself or herself, and the beneficiary is … Continue Reading

California Courts May Scrutinize Conservator Fees

Private professional fiduciaries in California are entitled to charge a reasonable fee for their services, but their fees for acting as conservators are subject to close court scrutiny. A recent California Court of Appeal case, In re Conservatorship of Presha (2018) 26 Cal.App.5th 487, shows how closely probate judges and their staffs may examine the … Continue Reading

Fore! California Court Drives Away Claim that Trustee’s Attorney Breached Trust

When attorneys advise errant trustees, how vulnerable are they to breach of trust claims by injured beneficiaries?  A case published last week by the California Court of Appeal provides a defensive roadmap to attorneys who are sued for such claims, along with an occasion for golf metaphors. In Cortese v. Sherwood (2018) 26 Cal.App.5th 445, … Continue Reading

Successor Trustee Gets Privileged Documents Even if Trust Says Otherwise

The attorney-client privilege in California belongs to the office of trustee, not to the incumbent in that office, thus generally allowing successor trustees to obtain confidential communications that their predecessors had with counsel.  We blogged last year about an appellate opinion that reinforced this concept. Last month, in Morgan v. Superior Court (2018) 23 Cal.App.5th … Continue Reading

Stepmother vs. Stepchild, Now Playing in a California Probate Court Near You

Stepmothers are frequent characters in California trust and estate litigation, as they are in fairy tales and Disney movies.  With about half of all marriages ending in divorce, there are many stepmother/stepchild relationships.  Mostly they work out fine, but some go south. After blogging on sibling conflicts as a driver of trust and estate disputes, … Continue Reading

Play It Again: No Contest Clauses Must Be Referenced In Each California Trust Amendment

No contest clauses are an ever-evolving area of the probate law in California.  The Court of Appeal further refined the rules governing no contest clauses in a decision issued last week, Aviles v. Swearingen (2017) 16 Cal.App.5th 485.  In brief, in order for a no contest clause to apply to a trust amendment, the no … Continue Reading

Anti-SLAPP Case Features Arm Wrestling Siblings and a Prep School

California’s anti-SLAPP statute has generated another published case for trust and estate lawyers to ponder.  Last week, in Urick v. Urick (2017) 15 Cal.App.5th 1182, the California Court of Appeal confirmed that anti-SLAPP motions can be used to attack petitions to enforce no contest clauses. The opinion reminds California trust and estate counsel to be … Continue Reading

Look! Up in the Sky! It’s Sibling Lawyer!

I’m a sibling lawyer.  My career started early, as a middle child, and now continues as a Sacramento-based trust and estate litigation attorney.  Most of my clients are grappling with sisters or brothers over the care and finances of aging or deceased parents.  In Family Feud parlance, my “survey says” that sibling versus sibling is … Continue Reading

Take It or Leave It: The Perilous Decision of Whether to Violate a No Contest Clause

One of the most dramatic areas of California trust and estate litigation is no contest clauses.  No contest clauses bring a made-for-tv excitement to the practice of trust and estate law because of the risk of disinheritance.  Yet such clauses are widely misunderstood, even among attorneys.… Continue Reading

California Professional Fiduciaries Help Elders and Resolve Conflicts

California trust and estate disputes may be avoided or resolved with the appointment of a private professional fiduciary to act in an oversight role with respect to an elder’s care and/or finances.  In a recent post, we suggested the use of professional fiduciaries or bank trust departments to resolve conflicts among family member co-trustees. Here … Continue Reading

Co-Trustee Conflict Fuels California Trust Litigation

California trust litigation often stems from disagreements and hostility among family member co-trustees.  Rather than picking one of their kids to serve as sole successor trustee when they die or become incapacitated, Mom and Dad often appoint two or more of their children to act together as successor co-trustees. Having more than one child serve … Continue Reading

Constructive Trusts Can Catch Wayward Trust Assets

Trustees in California trust disputes should not overlook the power of the constructive trust remedy as a way to recover errant trust assets.  That’s a takeaway from Higgins v. Higgins (2017) 11 Cal.App.5th 648, an opinion in a trust litigation case published last week by the California Court of Appeal. A Los Angeles Superior Court trial … Continue Reading
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