December 21, 2018

Standing to Challenge a Trust

Standing is the ability of a party to file a lawsuit. It acts as a limitation on the class of litigants that can bring forth claims.
For example, a child has standing to contest a parent's will or a parent has standing to pursue a wrongful death action involving a deceased child. 

Standing is procedural in nature. That is, the substantive merits of a case are inapplicable to determining whether or not a person has standing. 

For instance, assume a concerned neighbor witnessed their neighbor being coerced into signing a will. The coerced neighbor, a parent, was given the ultimatum by their child to sign the will leaving the entire estate to them, or else the wicked child would immediately place them in a retirement home. The coerced neighbor dreaded the idea of living out their life in a retirement home and repeatedly mentioned such to their neighbor. 

The foregoing facts would be highly relevant to a case involving undue influence in regards to the will's execution. However, the neighbor would not have standing to challenge the will's validity, despite their first-hand knowledge, because they lack a familial connection to the neighbor. Conversely, the other children of the coerced neighbor would have standing to challenge the will's validity because they clearly have a familial connection to their parent.

In terms of a trust, assume that a child was named a beneficiary of their parent's trust in earlier versions. Then in later versions, the child is disinherited. Following the parent's death, the child brings a petition to invalidate the trust amendments which disinherited them pursuant to Probate Code § 17200. 

The applicable section reads "Except as provided in Section 15800, a trustee or beneficiary of a trust may petition the court under this chapter concerning the internal affairs of the trust or to determine the existence of the trust." Probate Code § 17200(a).

A California trial court determined, which was upheld by the California Court of Appeal, that the disinherited child could not bring such a petition because they lacked standing. The plain language of Probate Code § 17200 provides standing for only trustees and beneficiaries, of which the disinherited child was neither. Therefore, the petition was dismissed due to lack of standing. 

Barefoot v. Jennings, (2018) 27 Cal. App. 5th 1       

The decision was surprising given that litigants often file suit to challenge a trust's validity based on Probate Code § 17200. Although there had been no case law that supported such an argument until now.

On December 13, 2018, the California Supreme Court granted review for the case. Hence, there will be a future ruling on whether or not a disinherited child has standing to file a petition under Probate Code § 17200.