For centuries, serious legal scholars have debated what is possibly the most vital question of our times: in what ways, if any, does our judicial system differ from basketball? Now, thanks to the California Supreme Court’s recent decision in Haggerty v. Thornton (2024) 15 Cal.5th 729, we finally have an answer.
Longtime readers of
We’ve been your dogged reporter on the ever-growing logjam in the Courts of Appeal on trust modification procedure. We’ve followed the twists and turns that courts have taken as they’ve tackled the question of what happens when a trust amendment complies with statutory amendment requirements, but fails to follow the trust’s own specified amendment procedure. We’ve zigged with Pena v. Dey, zagged with Haggerty v. Thornton, and zigged right back again with Balistreri v. Balistreri.
The California Supreme Court is poised to provide a definitive answer. It granted review in Haggerty v. Thornton and the case was fully briefed as of July 20, 2022. Hence, it seemed that the Courts of Appeal might sit on any new cases dealing with the issue and await the Supreme Court’s decision.
Spoiler alert: they didn’t.
The First District Court of Appeal recently joined the widening chasm amongst California appellate courts concerning trust modification procedure. Probate Code section 15402 is seemingly straightforward, consisting of a lone sentence: “Unless the trust instrument provides otherwise, if a trust is revocable by the settlor, the settlor may modify the trust by the procedure for
[Editor’s Note: The California Supreme Court granted review of Haggerty v. Thornton on December 22, 2021 in Case No. S271483. The Supreme Court is likely to resolve the conflict between Haggerty v. Thornton and King v. Lynch. In the meantime, per the Supreme Court’s order, the Haggerty opinion remains citable.]
The Legislature and courts
A key feature of a California revocable trust is that it can be amended. Revising a trust can, however, seem like an irksome chore so it’s common for creators of trusts (i.e., “settlors” or “trustors”) to shrug off an amendment until it becomes clear they have limited time to settle their affairs.
Such procrastination invites mistakes, including failure to comply with a trust’s built-in procedure for amendments. Indeed, while many trust instruments do not specifically prescribe how they may be amended, others do – often requiring “delivery” of the amendment to the trustees or settlors, that the amendment be signed, or both.
What happens when a settlor does not fully comply with the trust instrument’s modification procedure, even though it’s achingly obvious that he intended to amend his trust? Should a court rigidly bind him to the modification procedure or should it follow what seem to be his dying wishes? The California Court of Appeal faced this conundrum recently in Pena v. Dey (2019) 39 Cal.App.5th 546. The court required strict compliance with the trust’s modification procedure, rejecting a Post-it® note as satisfying a signature requirement.