Trust and Will

Much like how an apple is different than an orange. A trust is different than a will. For example, a trust can nominate John Doe to serve as trustee and Jane Doe to be the sole beneficiary. Conversely, a will drafted by the same individual can nominate Jane Doe to serve as the executor and John Doe to be the sole beneficiary. While it is quite common for a trust and will to be aligned, i.e. a person writes a trust and pour-over will, there is no underlying requirement. A recent unpublished appellate decision highlighted the fact that a trust and will are distinct testamentary documents.

“Quadri died on September 14, 2022. She had four daughters who survived her: Kime, Shoemaker, Laura Mae Haberkorn, and Linda Cherie Kime. Quadri had no other living or deceased children.

On December 10, 1994, Quadri executed a handwritten Last Will and Testament wherein she named Shoemaker as executor. The will equally bequeathed Quadri's entire estate to her four daughters.

On April 9, 2014, Quadri executed the Floy Wanda Quadri Living Trust with herself as grantor and Kime as trustee. The trust was never funded and Quadri never executed a pour-over will.

At the time of Quadri's death, her estate consisted of a condominium, some bank accounts, and tangible personal property. These assets were not titled to the trust.

On March 8, 2023, Shoemaker filed a petition for letters of administration. Two of the three daughters signed nominations of administrator to support Shoemaker's petition. Shoemaker was unable to find Quadri's original handwritten will and for that reason filed for letters of administration.

On April 27, 2023, the probate court held a hearing regarding Shoemaker's petition. No documents or competing petitions were filed. Shoemaker was represented by counsel and Kime appeared in propria persona to oppose Shoemaker's petition.

Kime asserted that the probate court should appoint her as administrator because Quadri had named her as trustee in the 2014 trust. Kime also contended that Shoemaker, Haberkorn, and Linda Cherie Kime conspired to unduly influence and abuse Quadri. Kime asserted that five months before her death, Quadri wanted to update her trust to leave the entire estate to Kime and exclude her other three daughters. Quadri took no further steps, however, to amend and fund the trust.

Following argument by the parties, the probate court granted the petition, appointed Shoemaker as administrator with full authority, and issued letters of administration. In ruling, the court explained that Shoemaker's petition concerned an intestate probate and an undue influence argument was not relevant.”

The Court of Appeal affirmed the trial court's decision.

"The probate court did not abuse its discretion by appointing Shoemaker as the administrator of Quadri's estate. In this intestate probate, each of the four daughters is entitled to an equal share and each has equal priority to be appointed administrator. (§§ 6402, subd. (a) [intestate succession]; 8467 [priority to be appointed administrator].) Only Shoemaker filed a petition seeking to be appointed administrator. Two of her sisters supported her nomination. Appointment of Shoemaker was not unreasonable and we do not substitute our decision for that of the probate court. (Estate of Selb, supra, 93 Cal.App.2d 788, 792.)"

In the Matter of Floy Wanda Quadri, Ventura County Superior Court case no. 202300576149PRLA

Ineffective Assistance of Counsel

The term "bad lawyering" could be considered an oxymoron because no attorney would ever perform in a substandard manner......

Obviously my facetiousness is painfully obvious to any person who has spent part of their existence reading this blog post. Of course lawyers can perform incompetently just as much as you can find shoddy work done by a plumber, doctor, electrician, engineer, barber, biologist, etc. A peculiar twist to "bad lawyering" is what recourse is available to the aggrieved party. Many people know that a lawyer can be sued for malpractice if they perform below the standard of care. However, another consequence is that a person can seek to have an adverse judgment against them reversed if they received "ineffective assistance of counsel," the legal term used to describe bad lawyering.

A recent unpublished appellate opinion addressed the issue of ineffective assistance of counsel in a probate matter.

"Donald K. Dawson (Dawson) appeals from an order denying a petition to rescind the transfer of title of a mobile home and include it and specified funds in the estate of decedent Doris Rose Dawson. (Prob. Code, § 850 et seq.) Dawson contends the trial court erred when it: (1) excluded an expert opinion that a release of ownership of the mobile home was not signed by decedent, (2) failed to find withdrawals from decedent's bank account were unauthorized, and (3) failed to find elder abuse. He also contends his counsel provided ineffective assistance, and he was denied equal protection of the law."

The appellate court addressed these issues in order before turning to the appellant's ineffective assistance of counsel argument.

"Dawson further contends his counsel was ineffective. We reject this contention because the doctrine of ineffective assistance of counsel applies to criminal cases and limited categories of civil cases not applicable here, such as "`where the litigant may lose his physical liberty if he loses the litigation'" (In re Marriage of Campi (2013) 212 Cal.App.4th 1565, 1574), juvenile dependency proceedings (id. at p. 1575), and LPS conservatorships (Conservatorship of David L. (2008) 164 Cal.App.4th 701, 710)."

Estate of Dawson, Ventura County Superior Court case no. 56-2022-00567630-PR-LA-OXN.

In contrast, in a criminal case, a defendant may seek to have their conviction reversed on appeal if they can prove that they received ineffective assistance of counsel. Strickland v. Washington, 466 U.S. 668. 

Estate Tax in 2025

Since the estate tax exemption amount is currently pegged to inflation, the IRS recently announced the exemption amount for 2025 as detailed below: 

Year                   Amount Excluded        Maximum Tax Rate
 
2001                   $675,000                      55%

2002                   $1M                             50%
 
2003                   $1M                             49%
 
2004                   $1M                             48%
 
2005                   $1M                             47%
 
2006                   $2M                             46%
 
2007                   $2M                             45%
 
2008                   $2M                             45%
 
2009                   $3.5M                          45%
 
2010                   Repealed                      0%
 
2011                   $5M                             35%
 
2012                   $5.12M                        35%
 
2013                   $5.25M                        40%
 
2014                   $5.34M                        40%
 
2015                   $5.43M                        40% 
 
2016                   $5.45M                        40%  
 
2017                   $5.49M                        40%         
 
2018                   $11.18M                      40%   

2019                   $11.4M                        40%  

2020                   $11.58M                      40% 

2021                   $11.7M                        40% 

2022                   $12.06M                      40% 

2023                   $12.92M                      40% 

2024                   $13.61M                      40%

2025                   $13.99M                      40%

Vexatious Litigant

A litigant is generally entitled to file court documents at their discretion. That is, the litigant does not need pre-approval to file a complaint, petition, objection, etc. from a third-party. However, for an unlucky subset of litigants, they do need pre-approval to file because they have been declared a vexatious litigant.

An unpublished appellate opinion described the rationale behind the vexatious litigant law:

"`The vexatious litigant statute (§ 391 et seq.) was enacted "`to curb misuse of the court system'" by "`persistent and obsessive' litigants." [Citation.]' [Citation.] Relevant here, a "`[v]exatious litigant'" is one who, proceeding in propria persona, . . . `repeatedly files unmeritorious motions, pleadings, or other papers, conducts unnecessary discovery, or engages in other tactics that are frivolous or solely intended to cause unnecessary delay' (inter alia)." (Deal, supra, 45 Cal.App.5th at p. 618.)

"`A court exercises its discretion in determining whether a person is a vexatious litigant'" based on statutory criteria. (Deal, supra, 45 Cal.App.5th at p. 621; see § 391, subd. (b).) "Once a person has been declared a vexatious litigant, the court, on its own or a party's motion, may `enter a prefiling order which prohibits [the person] from filing any new litigation in the courts of this state in propria persona without first obtaining leave of the presiding judge of the court where the litigation is proposed to be filed.'" (Shalant v. Girardi (2011) 51 Cal.4th 1164, 1170; see § 391.7.)

This unpublished appellate opinion also described how a party had been declared a vexatious litigant by a trial court:

"After a continued hearing, at which all parties had the opportunity to orally present their positions, the temporary judge hearing the motion issued an order granting respondents' motion. The written ruling listed roughly four dozen court filings by appellant since the time of the ruling on the first vexatious litigant motion, and it described them as "repetitive," "difficult to decipher," and unsuccessful. Based on appellant's actions of "repeatedly fil[ing] unmeritorious motions, pleadings, or other papers," the court found appellant to be a vexatious litigant and issued a prefiling order "prohibit[ing] [him] from filing any new litigation in the courts of this state in propria persona . . . without first obtaining leave of the presiding justice or presiding judge of the court where the litigation is proposed to be filed."  

The appellate court affirmed the the trial court's vexatious litigant determination.  

Elias v. Jensen, Orange County Superior Court case no. 30-2018-00980796

Duty of Care Owed to a Nonclient Third-Party

An attorney owes a duty of care to their client (see act in their best interest). In the context of estate planning, the client is writing an estate plan to benefit a third-party, i.e. the beneficiaries of their estate plan. The question then becomes, does the attorney owe a duty of care to third-party beneficiaries? A recent published appellate decision touched upon this issue. 

"Richard died in March 2014 at the age of 81. His estate was valued at $18 million. Richard's 2012 estate planning documents, prepared by appellants, disinherited respondents and Peter. Richard's entire estate was left to his fourth wife, Elizabeth Grossman (Elizabeth), even though she was independently wealthy. Richard married Elizabeth in 2000, and they remained married until his death."

Following Richard's death, the disinherited relatives sued the drafting attorney of Richard's estate plan for legal malpractice and prevailed at the trial court level. This decision was then appealed to the California Court of Appeal.

"The sole issue on appeal is whether appellants owed a duty of care to respondents even though respondents were not their clients. "Whether [such] a duty exists is a question of law that we independently assess." (Gordon, supra, 88 Cal.App.5th at p. 554;"

"In Gordon the Court of Appeal stated: "We hold, as the courts before us uniformly have, that a nonclient third party can maintain a malpractice action only if there is clear, certain and undisputed evidence of the client's intent to benefit the third party, or to benefit the third party in the way [the third party] claims . . ." (Gordon, supra, 88 Cal.App.5th at p. 564.) The third party must show that the client's attorney knew or reasonably should have known of this evidence when the alleged malpractice occurred. Attorneys are not clairvoyants capable of ascertaining the unexpressed intent of their clients. (See id., at p. 556 [nonclient plaintiff must "establish[] that the client, in a clear, certain and undisputed manner, told the lawyer, `Do X,' (where X benefits the plaintiff)"].) Because the evidence of Richard's alleged intent to leave his estate to respondents instead of Elizabeth is not clear, certain, and undisputed, as a matter of law the evidence is insufficient to show that appellants owed a duty of care to respondents in preparing the 2012 restatement of the ARG Trust. Wakeman's testimony, together with the supporting testimony of Elizabeth, Laurel Luby, and Meredith Rattay, shows that the evidence of Richard's alleged intent was disputed.

If Richard had intended to leave his estate to respondents, there would have been no need for him to have obtained the letter from Dr. Miao attesting to his capability of "making competent financial and estate planning decisions." Wakeman advised Richard to obtain the letter because Richard said he wanted to disinherit his children and grandchildren and leave his entire estate to his independently wealthy fourth wife. The imposition of malpractice liability in these circumstances would not only be unjust, it would also "place an `intolerable' `burden' on the legal profession." (Gordon, supra, 88 Cal.App.5th at p. 559.)" 

Grossman v. Wakeman (2024) ____ Cal.App.4th ____

Financial Elder Abuse

Under Welfare & Institutions Code §15610.30(a)(1)–(3), financial elder abuse occurs when an individual

"(1) Takes, secretes, appropriates, obtains, or retains real or personal property of an elder or dependent adult for a wrongful use or with intent to defraud, or both.

(2) Assists in taking, secreting, appropriating, obtaining, or retaining real or personal property of an elder or dependent adult for a wrongful use or with intent to defraud, or both.

(3) Takes, secretes, appropriates, obtains, or retains, or assists in taking, secreting, appropriating, obtaining, or retaining, real or personal property of an elder or dependent adult by undue influence, as defined in Section 15610.70."

A recent unpublished appellate opinion focused on the issue of financial elder abuse. The trial court ruled that respondent had committed financial elder abuse and awarded the petitioner $318,000 in compensatory damages and $50,000 in punitive damages. The respondent appealed the trial court's ruling of financial elder abuse. The appellate court agreed with the trial court's finding of financial elder abuse.

"From 2015 through 2017, under the guise of providing comfort and care, Baik repeatedly misrepresented to Mr. Tak that the government could seize his condominium before or after his death unless he created a trust. Fearing the loss of his home and worrying about his ability to reside in it for the rest of his life, Mr. Tak acted upon Baik's misinformation to create a trust.

Subsequently, in March 2017, Baik actively facilitated Mr. Tak's creation of the Trust by driving him to We the People and paying Yi for her services. As a result of her efforts, Mr. Tak signed a slew of complicated legal documents, which he could not read or understand. He believed that, by creating the Trust and signing those documents, he was protecting his home from government seizure and ensuring his testamentary wishes would be carried out. Instead, Mr. Tak unwittingly granted Baik the exclusive rights to his entire estate, including his condominium, upon his death. Two months later, Baik quelled any concerns Mr. Tak may have had by assuring him, in writing, that she would carry out his wishes by distributing $100,000 to his church and $50,000 to Hwang when he died. Her actions taken following Mr. Tak's death, however, reflect that this promise was false.

Rather than following Mr. Tak's testamentary wishes, Baik immediately commenced efforts to sell Mr. Tak's condominium as quickly and surreptitiously as possible. Less than two months after his death, she sold the condominium to a distant family member through a closed sale, after initially concealing the transaction from Hwang. Ultimately, through the relationship she formed with Mr. Tak, her campaign of misrepresentations causing him to fear the loss of his home and believe she would carry out his testamentary wishes, and her active efforts to ensure the Trust's creation, Baik pocketed nearly $200,000 from the sale of Mr. Tak's home, as well as $9,700 from his life insurance policy. As a result of her actions, Mr. Tak's wishes remain unfulfilled: Hwang and Mr. Tak's church have been deprived of gifts they would have received had Baik not kept the entirety of his estate.

On this record, we conclude there is substantial evidence to support a finding that Baik took and retained Mr. Tak's property with the intent to defraud and by undue influence. Thus, the trial court did not err by concluding Baik committed financial elder abuse under section 15610.30, subdivision (a)(1) and (3)."

In the Matter of: Grace S. Hwang, Los Angeles County Superior Court case no. B325870