Bank trust departments, also referred to as corporate trustees, provide professional management to the administration of California trusts.  People may choose to name a bank to act as successor trustee when they can no longer manage their own assets, either because they don’t have family members they can count on to handle assets or because they don’t want to burden family members with the role. Sometimes family members or a court may appoint a bank to take the place of an acting trustee as a means to resolve disharmony amongst the parties.

Alysia Corell joins us here to share her experiences as a trust officer.  Alysia grew up in the Mt. Shasta area of Northern California and traveled south to attend San Diego State University where she majored in communications.  She began to work in a bank trust department in 2003 and became a Certified Trust and Financial Advisor in 2008.  She is a past president and current member of the Sacramento Estate Planning Council and a member of the South Placer Estate Planning Council.  In 2018 Alysia joined the trust department of Exchange Bank.

A new case from the Court of Appeal once again illustrates the robust nature of claims under California’s Elder Abuse and Dependent Adult Civil Protection Act, also known as the Elder Abuse Act.

In Arace v. Medico Investments, LLC (2020) 48 Cal.App.5th 977, a San Bernardino County jury found the owner of a residential care facility for the elderly liable for the financial elder abuse of a resident, but did not award any damages on that claim.  Nonetheless, the court properly awarded legal expenses to the plaintiff as the prevailing party.  This broad view of a plaintiff’s entitlement to legal expenses shows the bite of the Elder Abuse Act and will encourage elders and their advocates to pursue financial elder abuse claims.

While California trustees hope for smooth sailing, they must navigate waters that can be choppy depending on the assets, trust instruments and personalities involved.  As fiduciaries, trustees must honor the trustors’ intent as expressed in the trust instruments.  Sometimes the language is unclear and the trustee needs instruction from a court as to how to proceed.

If they are not already working with an attorney, most trustees will (and should) seek guidance from counsel when uncertain about what to do.  An attorney, generally at the expense of the trust, can help the trustee decide whether to file a petition for instructions, draft the necessary paperwork, serve it on parties entitled to notice, and then appear in the probate department of the court on behalf of the trustee.  Some DIY-minded trustees, however, may be inclined to proceed without paying an attorney.  Business & Professions Code section 6125 provides that a person can’t practice law unless he/she is an active member of the State Bar of California.  When can a trustee represent himself or herself in court without engaging in unauthorized practice of law?

Earlier this month, the Court of Appeal held in Donkin v. Donkin, Jr. (2020) 47 Cal.App.5th 469 that individuals acting as trustees may represent themselves when seeking instructions from a California court.  Yet, like an inexperienced sailor who attempts a solo ocean journey, a trustee who proceeds without counsel risks serious missteps such that self-representation may end up being far more costly in the long run.

California trust and estate disputes often involve allegations that a surviving spouse took advantage of a deceased spouse so as to get more of the latter’s assets.  Often the “spousal financial abuse” charges are leveled by the deceased spouse’s biological children against their step-parent, as discussed in a prior post.  Sometimes care custodians who…

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 happens when the Attorney General is only partially successful in its case against the defending trustee of a charitable trust?

People ex rel. Becerra v. Shine (2020) ____ Cal.App.5th ____ provides the answer.  The Government Code does not require a stringent analysis of whether the Attorney General has achieved all of its litigation goals or has been completely successful on every claim.  Further, the Attorney General is entitled to attorney’s fees when it has generally accomplished what it set out to do, which in People v. Shine was to prove that Shine had breached his fiduciary duties and to recover funds for the trust.

Scientist in a laboratoryWhat a difference a few weeks make!  A month ago, the COVID-19 virus was a distant threat.  Over the last few weeks, California courts and law offices have closed, leaving families at home and uncertainty as to when “normal” will return.

Colleagues share that COVID-19 has led to a flurry of calls from clients who want to push forward to complete estate plans that they had left unfinished.  Folks who never had estate plans also are seeking to get them done.

California’s estate planning formalities, however, create challenges in our pandemic situation.

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 if someone’s trying to tamper with their potential payday.  But how far do notice requirements really go?  Must notice be given to beneficiaries who likely won’t ever get a nickel?

The California Court of Appeal wrestled with this issue in Roth v. Jelley (2020) 45 Cal.App.5th 655, and held that beneficiaries who will only receive an inheritance upon the happening of an event (i.e., contingent beneficiaries) have a property interest in an inheritance and are therefore entitled to notice under constitutional due process requirements.

Tracy PottsTracy 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 County Bar Association, Probate and Estate Planning Section.  She is a certified specialist in estate planning, trust, and probate by the State Bar of California, Board of Legal Specialization.  She also is a fellow of the The American College of Trust and Estate Counsel.

Tracy’s law firm, Legacy Law Group, operates from the Natomas area of Sacramento.  I sat down with Tracy at her office in February 2020 to discuss estate planning and dispute avoidance.

Judge Kevin R. Culhane rotated into Sacramento County Superior Court’s probate department in January 2020.  He shared his initial impressions with members of the probate bar on February 18, 2020, at the monthly lunch of the Sacramento County Bar Association’s Probate and Estate Planning Law Section.

Noting that probate filings are on the rise, he likened the business of the Court’s probate unit (Department 129) to trying to fit ten gallons of water into a five-gallon bucket.

Last week the California Supreme Court issued a unanimous opinion in Barefoot v. Jennings (2020) 8 Cal.5th 822, ruling that a trust beneficiary disinherited in an amendment may contest the amendment’s validity in the probate department of the Superior Court under California Probate Code section 17200.

The Court of Appeal had narrowly construed…