Filed 10/17/18

CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FOURTH APPELLATE DISTRICT

DIVISION THREE

ORANGE CATHOLIC FOUNDATION et 

al.,

 Plaintiffs and Appellants,

v.

ROSIE MARY ARVIZU, as Trustee, etc.,

 Defendant and Respondent.

 G055189

 (Super. Ct. No. 30-2014-00753823)

 O P I N I O N

Appeal from a judgment of the Superior Court of Orange County, William 

D. Claster, Judge. Affirmed.

Baker & Baker, William E. Baker, Jr., and Brook John Changala for 

Plaintiffs and Appellants.

Buffington Law Firm, Roger J. Buffington, Kaden J. Kennedy, and Brooke 

A. Buchanan for Defendant and Respondent.

* * *
Probate Code section 16440, subdivision (b) (16440(b)) provides that if a 

“trustee has acted reasonably and in good faith under the circumstances as known to the 

trustee,” a court has discretion to excuse him or her from liability for a breach of trust if it 

would be equitable to do so.

1

 (Italics added.) Acting under this express authority, the 

trial court denied a petition brought by Orange Catholic Foundation

2

and Kevin W. Vann, 

the Roman Catholic Bishop of Orange (collectively, the Church) to remove Rosie Mary 

Arvizu from her position as trustee of the Josephine Kennedy Trust (Trust) and for 

damages. Finding no abuse of discretion, we affirm the judgment.

The Trust gave a life estate in Kennedy’s house (the Residence) to Paul 

Senez, her very dear family friend of over 60 years, provided that he pay for certain 

expenses related to the Residence. The Trust further provided that upon Senez’s death, 

the Residence was to be sold and the proceeds were to be given to the Church for the 

benefit of the needy elderly and abused children. The Church alleged that Arvizu 

(Kennedy’s niece and the successor trustee) breached her duties as trustee by: (1)

improperly using Trust funds to pay expenses that should have been borne by Senez (who 

was elderly, destitute, suffering from dementia, and unable to cover the expenses

himself); (2) failing to evict Senez when he could not pay those expenses; and (3) not 

promptly renting out or selling the Residence after Senez’s death (a delay which occurred 

in part due to Arvizu’s cancer treatment and other health issues, and which fortuitously 

benefited the Church because the Residence appreciated by $136,000 during the period 

of Arvizu’s inaction).

1

All further undesignated statutory references are to the Probate Code.

2

Orange Catholic Foundation is a not-for-profit corporation that administers all gifts for 

the Roman Catholic Diocese of Orange. The Roman Catholic Bishop of Orange 

appointed and authorized Orange Catholic Foundation to litigate this petition on the 

Church’s behalf.

2

 
The trial court denied the Church’s petition, invoking its equitable power 

under section 16440(b) to excuse Arvizu from liability. The court observed that the 

Church’s argument that Senez should have been evicted, while perhaps technically 

correct, is “both unrealistic and not particularly charitable.” The court went on: “How 

could Arvizu in good conscience boot out a man who essentially was a member of her 

family, had lived in the house for 40 years, was suffering from dementia and had minimal 

financial assets? . . . Under the circumstances, it is hard to imagine that anyone would 

take that step.” As detailed below, we conclude that substantial evidence supported the 

trial court’s finding that Arvizu acted reasonably and in good faith, and we find no abuse 

of discretion in the trial court’s exercise of its equitable powers under section 16440(b).

I

FACTS AND PROCEDURAL HISTORY

A. The Parties and the Trust

Senez was a longtime friend of the Kennedy family. Although not related 

to the Kennedys by blood, he was considered a member of the family, spent holidays 

with them, and was affectionately known as “Uncle.” He lived with the Kennedy family 

for 60 years, including 40 years spent at the Residence. When Kennedy’s husband was 

alive, Senez worked as a driver for his extermination business. After Kennedy’s husband

passed away, Senez continued to live with Kennedy at the Residence and took care of her

in her old age. Kennedy treated Senez like a son.

Kennedy established the Trust in 1997, naming herself as Trustee. Article 

II-B(2) and (3) of the Trust provided that upon her death, “[¶] . . . [¶] (2) The Trustee 

shall retain, IN TRUST, all of the Trustor’s interest in the [Residence]..., for the use and 

benefit of PAUL A. SENEZ for the remainder of his life; provided, however, that during 

the period that PAUL A. SENEZ is residing in said residence, he shall be responsible for 

payment of all expenses incurred in the upkeep of said residence, including but not 

3
limited to mortgage payments, taxes, utilities, insurance, and any other expenses which 

may be incurred. Upon the death of PAUL A. SENEZ, or in the event he shall choose 

not to reside in said residence, the property shall be sold and distributed as set forth in 

paragraph (3) below. [¶] (3) The Trustee shall distribute the rest, residue and remainder 

of the Trust Estate to the ORANGE COUNTY CATHOLIC DIOCESE, to be used for the 

benefit of abused and needy children and the needy elderly, as said Diocese shall 

determine.”

In 2003, Kennedy executed a Second Amended Declaration of Trust. That 

Amendment repeated most of the above language, with the exception of the sentence in 

Article II-B(2) stating what financial responsibilities Senez would have while living in 

the Residence. The revised language removed any obligation to pay mortgage payments 

and required Senez to pay only for “ordinary maintenance expenses” (as opposed to “any 

other expenses which may be incurred”).

The Trust named Kennedy’s niece, Arvizu, as the successor trustee. 

Kennedy and Arvizu were very close, and Arvizu regarded Kennedy as a mother and 

confidant. Over the years, Arvizu and Kennedy had many discussions about Kennedy’s 

intentions and desires concerning the Trust, and in light of those conversations, Arvizu 

believed that Kennedy expected her to look after Senez and pay for certain expenses if he 

was unable to pay for them himself. According to Arvizu, Kennedy repeatedly told her 

to take care of Senez, to help him keep the property up, and to pay for Senez’s cremation 

and funeral using Trust assets. Based on their conversations, Arvizu also believed that 

her aunt wanted her to ensure that Senez (a Korean War veteran) was buried in a 

veterans’ cemetery.

4
B. Senez’s Last Few Years in the Residence

Kennedy died in 2007 at the age of 100. Arvizu, who was in her 70s by 

then and neither legally nor financially sophisticated,

3

became trustee. She retained the 

same attorney who had prepared the Trust to advise her in administering the Trust, and 

the attorney gave her instructions regarding her duties as trustee.

Senez was living in the Residence when Kennedy died (as he had been for 

decades), and unfortunately, he was not in a position to live by himself. He was elderly;

he was also in failing health and displaying signs of dementia. Arvizu offered Senez a 

room in her house, but he became irate and replied that he would stay in the house where 

he had lived for 40 years until he died. 

At some point, Arvizu’s estranged daughter, Mary Ann, who was very 

close with Senez, moved into the Residence to help take care of him. She did so without 

permission from or even telling Arvizu, although Arvizu eventually learned that Mary 

Ann was living at the Residence. Mary Ann bathed and fed Senez, helped him with his 

medications, ran errands for him, monitored his medication, cleaned the house, and paid 

his bills. His dementia progressed to the point that if he was not monitored, he would 

wander off by himself, so Mary Ann prevented him from doing so.

Senez could not afford the expenses associated with living in the 

Residence. Thus, even though the Trust expressly required Senez to pay for certain 

expenses associated with the Residence, and even though Arvizu understood that the 

Trust required Senez to pay for those expenses, Arvizu paid Senez’s bills using Trust 

assets. Arvizu testified that she “thought [she] was doing the right thing,” that she “did 

what [her] aunt wanted [her] to do,” and that in her mind, these payments were justified 

3

Arvizu has an 11th grade education, and she worked as a beautician for a few years and 

then as an assembler for TRW for many years.

5

 
by the multiple statements Kennedy had made before her death that Arvizu should take 

care of Senez.

According to the Church, Arvizu spent $44,416 of Trust assets to pay 

expenses that should have been borne by Senez. The trial court found that these expenses 

fell into two main categories: (1) expenses that clearly benefited the Residence, and

(2) expenses that were personal to Senez. The first category of expenses, which totaled 

$40,208, included items such as property taxes and homeowners association dues; the 

trial court found that Arvizu credibly testified that she paid those expenses to avoid

foreclosure.

4

The second category of expenses, which totaled $4,208, included items 

such as Senez’s car payments, auto insurance, utilities, and (after his death) his funeral 

expenses, all of which the trial court found should not have been paid by the Trust.

C. Arvizu’s Delay in Selling the Residence

Senez died in October 2012. On the day of his wake, Arvizu told Mary 

Ann that she needed to move out of the Residence. Mary Ann replied that she would do 

so but that she needed some time, and Arvizu believed her. 

As it turned out, Mary Ann remained in the Residence for nearly two years 

after Senez’s death, despite her mother’s repeated requests that she move out. According 

to Mary Ann, it took her awhile to find a place to live. Arvizu did not act more 

decisively in evicting her daughter, in part because Arvizu was in and out of the hospital 

due to her own health problems (including breast cancer treatment and a knee surgery).

Arvizu was also caring for her ill husband, who had a tumor.

4

Arvizu’s attorney testified along similar lines: she said that paying those expenses (as 

opposed to filing a section 17200 petition for instructions and waiting months for an 

outcome) preserved Trust assets and benefited the Trust by avoiding additional penalties, 

liens, and foreclosure.

6

 
During that two-year period, Arvizu did not collect rent from Mary Ann. 

According to the Church, the reasonable rental value of the Residence was about $2,900 

per month (assuming the Residence was in average condition, which does not appear to 

have been the case). Thus, claimed the Church, the Trust lost about $70,000 in lost rent 

during that period.

Arvizu eventually involved her attorney, who wrote a letter to Mary Ann in 

July 2014 threatening her with legal action if she did not move out of the Residence.

Mary Ann vacated the Residence the following month. By October, a realtor prepared a 

listing agreement for the Residence, which by then was in extremely poor condition and 

required extensive clean up and repairs.

5

 Arvizu was cooperative in selling the 

Residence, which eventually sold in March 2015 for $546,000.

Despite the lost rent, Arvizu’s two-year delay in putting the Residence on 

the market proved to be very beneficial to the Trust. It is undisputed that the market 

value of the Residence increased from $410,000 in November 2012 (the month after 

Senez died) to $546,000 in March 2015 (when the Residence was finally sold) as a result 

of the real estate market going up. This $136,000 increase greatly exceeded the alleged 

lost rent of $70,000. Arvizu gave the proceeds from the sale of the house to the Church

in accordance with the terms of the Trust.

D. Proceedings in the Trial Court

The Church filed a verified petition to remove and replace Arvizu and for 

damages for breach of trust and breach of fiduciary duty. After a two-day bench trial, the 

trial court issued an eight-page written decision denying the Church’s petition. In its 

5

The testimony at trial was inconsistent as to when exactly the Residence became so 

deteriorated — before Kennedy’s death (pre-2007), after Kennedy’s death but before 

Senez’s death (2007-2012), or after Senez’s death when Mary Ann was living at the 

Residence alone (2012-2014).

7

 
findings of fact, the court concluded that Arvizu “plainly decided to act in a way that she 

believed carried out the wishes of her Aunt (Kennedy) notwithstanding the language of 

the Trust”; that in Arvizu’s mind, the use of Trust funds to pay for various expenses was 

“justified by statements that had been made to her by Kennedy before her death” about 

the need to take care of Senez; and that “none of [Arvizu’s] actions appear to have been 

taken to benefit her personally.”

The court then reasoned as follows: “There is little question that Arvizu 

did not follow the exact requirements of the Trust in administering it after Kennedy’s 

death. During the five years that Senez held a life estate in the Residence, she used Trust 

assets to pay both expenses that Senez was supposed to pay and some of his personal 

expenses. After his death in 2012, she failed to act promptly in selling the property and 

then turning the proceeds over to the Church. Further, during the two year period of 

delay, she did not rent the property, instead allowing her estranged daughter to remain 

there rent-free. This conduct falls below the standard of care required of a trustee by the 

Probate Code. See Probate Code §§ 16002, 16004, 16006, 16007.

“Balanced against these issues are the justifications offered by Arvizu for 

her actions. As to the payments of property taxes and homeowner association dues, 

Arvizu legitimately concluded that paying these expenses ultimately would benefit the 

Trust since possible foreclosure and penalties could be avoided. Other expenses that 

were plainly personal to Senez were paid not to benefit Arvizu, but to carry out what she 

believed were her Aunt’s wishes.

“Considering these facts, it is difficult to fault Arvizu for her actions—at 

least up to the time of Senez’s death. Thus, in response to the Court’s questions at the 

conclusion of the trial as to what Arvizu should have done when it became clear to her 

that Senez could not make the payments required by the Trust, the attorney for the 

Church stated that Arvizu should have evicted Senez and sold the Residence (or simply 

deeded it over to the Church). While this statement may be technically correct, it strikes 

8
the Court as both unrealistic and not particularly charitable. How could Arvizu in good 

conscience boot out a man who essentially was a member of her family, had lived in the 

house for 40 years, was suffering from dementia and had minimal financial assets? 

Given his adamant refusal to move when asked to do so by Arvizu in 2007, her legal 

remedy would have been to institute an unlawful detainer action against him. Under the 

circumstances, it is hard to imagine that anyone would take that step.

“As to the two years of rent that Arvizu failed to charge for the Residence, 

she is somewhat more blameworthy. While it undoubtedly would have been 

uncomfortable to evict her daughter immediately after Senez’s death, Arvizu, as the 

Trustee, was required to do whatever was reasonably necessary to preserve all Trust 

assets. Other than her own ill health and the obvious difficult dynamics of her 

relationship with Mary Ann, Arvizu presented no legitimate justification for her actions.

“That being said, the loss of $69,600 in rent is more than offset by the 

$136,000 increase in the value of the Residence as a result of the delayed sale. This 

increase in value also more than covers any of Senez’s purportedly unauthorized 

expenses paid by the Trust. . . .

“Here, the total financial losses that resulted from Arvizu (1) paying 

unauthorized expenses for Senez, (2) delaying the sale of the property and (3) not renting 

the Residence are offset or mitigated by the increase in the value of the property between 

the date of Senez’s death in 2012 and the sale of the property in 2015. Given this 

appreciation, the Church is hard-pressed to demonstrate any real losses attributable to 

Arvizu’s actions.

“. . . [I]t is well-settled that the remedies of trust beneficiaries are equitable 

in nature. (Rest. 3d of Trusts, §95.) Indeed, Probate Code Section 16440(b) provides in 

pertinent part as follows: ‘If the trustee has acted reasonably and in good faith under the 

circumstances as known to the trustee, the court, in its discretion, may excuse the trustee

in whole or in part from liability under subdivision (a) if it would be equitable to do so.’ 

9
(Emphasis added.) As set forth above, the evidence strongly supports the conclusion that 

Arvizu acted reasonably and in good faith under the unique circumstances of the case. 

Significantly, at no time did she take any actions designed to benefit herself personally. 

Further, although some of her actions were in contravention of the precise wording of the 

Trust, all of Arvizu’s actions were, at least in her mind, consistent with the wishes of her 

aunt, the trustor.”

For the above reasons, the trial court denied the Church’s petition. It then

entered a judgment denying the Church’s petition, deeming the Trust fully distributed, 

and dissolving the Trust. The Church appealed the judgment, arguing (among other 

things) that the trial court erred in using its equitable powers to excuse Arvizu’s breaches.

II

DISCUSSION

A. Standard of Review

The parties dispute the applicable standard of review. Multiple standards

are applicable here.

We review the trial court’s findings of fact, including its factual findings on

witness credibility and whether Arvizu acted reasonably and in good faith, under the 

substantial evidence standard of review. (Williamson v. Brooks (2017) 7 Cal.App.5th 

1294, 1299; Johnson v. Pratt & Whitney Canada, Inc. (1994) 28 Cal.App.4th 613, 622.) 

Under this standard, “our review begins and ends with a determination as to whether 

there is any substantial evidence, contradicted or uncontradicted, to support the findings 

below.” (Williamson, at p. 1299.) “In assessing whether any substantial evidence exists, 

we view the record in the light most favorable to respondents, giving them the benefit of 

every reasonable inference and resolving all conflicts in their favor.” (Ibid.) “‘[I]t is not 

our role to reweigh the evidence, redetermine the credibility of the witnesses, or resolve 

conflicts in the testimony, and we will not disturb the judgment if there is evidence to 

10
support it.’” (Id. at p. 1300.) Where multiple inferences can be drawn from the evidence, 

we defer to the trial court’s findings. (Shamblin v. Brattain (1988) 44 Cal.3d 474, 478-

479.) “If the trial court’s resolution of the factual issue is supported by substantial 

evidence, it must be affirmed.” (Winograd v. American Broadcasting Co. (1998) 68 

Cal.App.4th 624, 632.)

We review the trial court’s exercise of its equitable powers — including its 

decision to excuse a trustee for breach of trust under section 16440(b) — for abuse of 

discretion. (City of Barstow v. Mojave Water Agency (2000) 23 Cal.4th 1224, 1256; 

Uzyel v. Kadisha (2010) 188 Cal.App.4th 866, 911.) “An abuse of discretion occurs only 

if the reviewing court, considering the applicable law and all of the relevant 

circumstances, concludes that the trial court’s decision exceeds the bounds of reason and 

results in a miscarriage of justice.” (Ibid.) In applying the abuse of discretion standard, 

“we resolve all evidentiary conflicts in favor of the judgment and determine whether the 

court’s decision ‘“falls within the permissible range of options set by the legal criteria.”’” 

(Hirshfield v. Schwartz (2001) 91 Cal.App.4th 749, 771.) We may reverse only if the 

trial court’s decision “‘exceeds the bounds of reason, all of the circumstances before it 

being considered.’” (Denham v. Superior Court (1970) 2 Cal.3d 557, 566.)

B. The Court’s Equitable Powers Under Section 16440

“The remedies of a beneficiary against the trustee are exclusively in 

equity.” (§ 16421; see Rest.3d Trusts, § 95 [“With limited exceptions, the remedies of 

trust beneficiaries are equitable in character and enforceable against trustees in a court 

exercising equity powers”].) This is significant, because it means that “wide play is 

reserved to the court’s conscience in formulating its decrees.” (Lickiss v. Financial 

Industry Regulatory Authority (2012) 208 Cal.App.4th 1125, 1133.)

Equity “‘“has its origins in the necessity for exceptions to the application of 

rules of law in those cases where the law, by reason of its universality, would create 

11
injustice in the affairs of men.”’” (Lickiss v. Financial Industry Regulatory Authority, 

supra, 208 Cal.App.4th at p. 1133.) “The equitable powers of a court are not curbed by 

rigid rules of law,” but rather “are broad enough to address novel conditions and meet the 

requirements of every case.” (Ibid.) “In other words, equity recognizes that we live in a 

changing world and equitable remedies are flexible, capable of expanding to meet the 

increasing complexities of these changing times.” (Ibid.) “The object of equity is to do 

right and justice. It ‘does not wait upon precedent which exactly squares with the facts in 

controversy, but will assert itself in those situations where right and justice would be 

defeated but for its intervention.’” (Hirshfield, supra, 91 Cal.App.4th at p. 770.)

Consistent with the equitable nature of a beneficiary’s remedies, section 

16440 gives trial courts wide latitude in deciding whether and what types of damages to 

impose on a trustee who commits a breach of trust (which section 16400 defines as a

“violation by the trustee of any duty that the trustee owes the beneficiary”).

6

 Subdivision 

(a) authorizes the trial court to determine which of three measures of liability provided in

the statute “is appropriate under the circumstances,” and subdivision (b) gives the court 

discretion to excuse the trustee from liability for any breach of trust that he or she

committed reasonably and in good faith, if it would be equitable to do so. (§ 16440; see 

Borissoff v. Taylor & Faust (2004) 33 Cal.4th 523, 532 [noting that subdivision (b) 

“permits courts to excuse from liability fiduciaries who have acted reasonably and in 

good faith under the circumstances as known to the fiduciary”].) 

6

The statute provides in full: “(a) If the trustee commits a breach of trust, the trustee is 

chargeable with any of the following that is appropriate under the circumstances:

(1) Any loss or depreciation in value of the trust estate resulting from the breach of trust, 

with interest. (2) Any profit made by the trustee through the breach of trust, with interest. 

(3) Any profit that would have accrued to the trust estate if the loss of profit is the result 

of the breach of trust. (b) If the trustee has acted reasonably and in good faith under the 

circumstances as known to the trustee, the court, in its discretion, may excuse the trustee 

in whole or in part from liability under subdivision (a) if it would be equitable to do so.” 

(§ 16440.)

12

 
In enacting subdivision (b), our Legislature codified the “good faith”

exception contained in the Restatement Second of Trusts (§ 205, com. g), which stated in 

pertinent part that “a court of equity may have power to excuse the trustee in whole or in 

part from liability where he has acted honestly and reasonably and ought fairly to be 

excused.” (Cal. Law Revision Com. com., 54A West’s Ann. Prob. Code (2011 ed.) § 

16440, pp. 265-266; see Rest.3d Trusts, § 95, com. d [“If . . . the court concludes that, in 

the circumstances, it would be unfair or unduly harsh to require the trustee to pay, or pay 

in full, the liability that would normally result from a breach of trust, the court has 

equitable authority to excuse the trustee in whole or in part from having to pay that 

liability”].)

C. The Trial Court Did Not Abuse Its Discretion in Excusing Arvizu

Given the language of section 16440(b), a threshold question is whether 

there was substantial evidence to support the trial court’s factual findings of 

reasonableness and good faith. We conclude there was. 

With regard to the payment of Senez’s expenses, Arvizu testified that she 

believed that she was doing the right thing and acting in accordance with her aunt’s 

instructions to take care of Senez. The vast majority of those expenses ($40,208 of the 

$44,416 paid) benefited the Residence, and the trial court found that Arvizu credibly 

testified that she paid those expenses to avoid foreclosure. Importantly, this was not a 

case of self-dealing by a trustee, and none of Arvizu’s actions appeared to have been 

taken to benefit her personally. 

As for the delay in selling the Residence and the concurrent failure to 

collect rent, Arvizu’s testimony regarding her failing health and hospitalizations 

supported the trial court’s conclusion that her inaction, though below the standard of care

and “somewhat more blameworthy,” was neither unreasonable nor done in bad faith. It is 

not our role to reweigh the evidence or redetermine the credibility of the witnesses, and 

13
we will not disturb the trial court’s factual findings of reasonableness and good faith 

where, as here, there is substantial evidence to support them. (Williamson v. Brooks,

supra, 7 Cal.App.5th at pp. 1299-1300; see In re Marriage of Boswell (2014) 225 

Cal.App.4th 1172, 1175 [“An adverse factual finding is a poor platform upon which to 

predicate reversible error”].)

Given its findings of reasonableness and good faith, section 16440(b) 

afforded the trial court broad discretion to excuse Arvizu from liability, and we find no 

abuse of discretion in the trial court’s decision to do so. (Contrast Uzyel v. Kadisha, 

supra, 188 Cal.App.4th at pp. 906-907 [finding that subdivision (b) did not apply because 

the trustee had acted in bad faith by serving his own interests].) Since the determination 

of the appropriate relief in a trust dispute is exclusively a matter in equity (§ 16421), the 

relief afforded to the parties is properly left to the trial court for determination and 

generally should not be disturbed on appeal. (Rivero v. Thomas (1948) 86 Cal.App.2d 

225, 238 [“The matter of determining the appropriate equitable relief to be granted to a 

beneficiary is generally left to the good judgment of the trial court. If the method is in 

accordance with an applicable law, the trial court’s judgment should prevail”].) Having 

heard the entire case and observed the demeanor of the witnesses, the trial court was in a 

far better position than we are to apply equitable principles to its factual findings. We 

will not supplant our judgment for that of the trial court, particularly considering that its 

decision to excuse liability squarely fell “‘“within the permissible range of options”’” set 

forth in section 16440. (Hirshfield v. Schwartz, supra, 91 Cal.App.4th at p. 771.)

The Church colorfully argues on appeal that the trial court could not use its 

equitable powers to excuse Arvizu’s conduct because her treatment of Senez was 

“objectively despicable,” “reprehensible,” and amounted to “clear and patent elder 

abuse.” More specifically, the Church asserts that Arvizu immorally abandoned a veteran 

with senile dementia by leaving him “to languish in filth” with Arvizu’s dangerous and

estranged daughter, rather than getting him the help he needed at “the V.A.”

14
There are many problems with this argument. First, it is speculative and 

not supported by the record. Despite the Church’s attempts at trial to paint Mary Ann as 

an unsavory individual, there was no evidence that Mary Ann ever physically mistreated 

or abused Senez; there was conflicting evidence at trial as to when exactly the Residence 

became so deteriorated to the point of being uninhabitable (i.e., whether that happened 

before or after Senez’s death); and there was no evidence at trial concerning what 

veterans benefits, if any, Senez would have been entitled to had he applied, or how those 

benefits could have helped his situation. To the contrary, the evidence at trial 

overwhelmingly indicated that Arvizu was trying to do the right thing by letting Senez 

stay in the house he had lived in for over 40 years, and that Mary Ann generally helped

Senez’s situation. The Church’s contention on appeal about Senez allegedly being 

mistreated is inconsistent with the position it took at trial, where the Church repeatedly 

advocated that Arvizu should have evicted Senez (in the words of the Church’s counsel, 

“kick him out”), even though he was senile and destitute with no means to care for 

himself.

The Church also asserts on appeal that Arvizu “misappropriated money to 

be used for needy children and the elderly to help out her uncle,” and that the trial court’s 

ruling “came at a cost to the actual beneficiaries of the Kennedy’s Trust Estate – the 

elderly and children to which she left it.” This argument also falls flat. As noted above, 

the vast majority (over 90%) of expenses paid out of Trust assets during Senez’s final 

years in the Residence benefitted the Residence (and hence the Trust, the Church, and the 

future recipients of any charity) by avoiding foreclosure, liens, and penalties. Further, the 

Trust sustained no damages as a result of Arvizu’s delay in selling the Residence and her 

15
failure to rent it out; to the contrary, the Trust actually made money as a result of the 

Residence’s $136,000 appreciation during the period of Arvizu’s inaction.7

 

The Church correctly notes that in exercising its equitable powers, a trial 

court must consider the equities on both sides of a dispute (Cortez v. Purolator Air 

Filtration Products Co. (2000) 23 Cal.4th 163, 180), but the trial court did just that and 

concluded that “the Church is hard-pressed to demonstrate any real losses attributable to 

Arvizu’s actions.” Indeed, when the trial court inquired at the conclusion of trial how the 

Church or its charity recipients were damaged by the delay in selling the house, the 

Church’s counsel conceded that he “can’t qualify that dollar amount,” adding, “who 

knows what damage was caused by that.”

The Church also asserts that Arvizu should not have been rewarded for 

willfully breaching her fiduciary duties and for willfully disregarding the terms of the 

Trust. This argument misses the point of section 16440(b), the applicability of which 

does not turn on whether the trustee acted negligently or willfully. Section 16440(b) 

gives a trial court discretion to excuse a trustee from liability for any breach of trust 

committed reasonably and in good faith, if it would be equitable to do so. “‘Obviously, a 

decision which simply ignores statutory requirements constitutes an abuse of discretion.’” 

(People v. Superior Court (Martinez) (2002) 104 Cal.App.4th 692, 697.) But here the 

trial court did not ignore statutory requirements; instead, it acted within the express 

authority of section 16440(b).

In affirming the judgment, we certainly do not mean to suggest the trial 

court was required to excuse Arvizu’s conduct, or that a trustee who has acted reasonably 

7

There were thus no damages available for Arvizu’s inaction: there was no “loss or 

depreciation in value of the trust estate,” no “profit made by the trustee,” and no lost 

“profit that would have accrued to the trust estate.” (§ 16440(a); see Rest.3d Trusts,

§ 101 [allowing trustee’s liability for breach to be reduced by a profit if “the acts of 

misconduct causing the loss and the profit constitute a single breach”].)

16

 
and in good faith must always be relieved from liability for committing a breach of trust, 

or that a trustee always has free reign to ignore trust terms in the name of doing the “right 

thing.” We hold only that the trial court had discretion to excuse Arvizu under section 

16440(b), and given that substantial evidence supported the trial court’s findings of good 

faith and reasonableness, we find no abuse of that discretion.

8

IV

DISPOSITION

The judgment is affirmed. Arvizu shall recover her costs on appeal. (Cal. 

Rules of Court, rule 8.278(a)(1).)

MOORE, J.

WE CONCUR:

O’LEARY, P. J.

THOMPSON, J.

8

In light of our holding that section 16440(b) supported the trial court’s decision to 

excuse Arvizu from liability, we need not address the other issues raised by the Church

on appeal. We affirm a trial court’s ruling if correct for any reason. (D’Amico v. Board 

of Medical Examiners (1974) 11 Cal.3d 1, 18-19.)

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