Court Opinion

ID: 4654660
Source: CourtListenerOpinion
Date Created: 2021-01-26 19:02:25.41088+00
Date Added: 2024-06-11T07:58:48.585128
License: Public Domain

Filed 1/26/21
                CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                 SECOND APPELLATE DISTRICT

                           DIVISION SIX

DAVID BRESLIN, as Trustee,             2d Civ. No. B301382
etc.,                                (Super. Ct. No. 56-2018-
                                      00521839-PR-TR-OXN)
     Plaintiff and Respondent,          (Ventura County)

v.

PAUL G. BRESLIN et al.,

  Defendants and
Respondents;

PACIFIC LEGAL
FOUNDATION et al.,

     Defendants and Appellants.

      The trustee of a decedent’s trust petitioned the probate
court to determine the trust beneficiaries. The probate court
ordered the matter to mediation. The potential beneficiaries
received notice of the mediation, but some did not participate.
The participating parties reached a settlement that excluded the
nonparticipating parties as beneficiaries. The probate court
approved the settlement. The nonparticipating parties Pacific
Legal Foundation et al.1 (collectively “the Pacific parties”) appeal.
We affirm. A party receiving notice who fails to participate in
court-ordered mediation is bound by the result.
                                FACTS
       Don Kirchner died in 2018 leaving an estate valued at
between $3 and $4 million. Kirchner had no surviving wife or
children, but he was survived by a number of nieces and
nephews.
       Kirchner’s estate was held in a living trust dated July 20,
2017. The trust was amended and restated on November 1, 2017
(restated trust). David Breslin (Breslin) was named the
successor trustee in the restated trust.
       Breslin found the restated trust, but initially could not find
the original trust. The restated trust makes four $10,000 specific
gifts and directs that the remainder be distributed to the persons
and charitable organizations listed on exhibit A in the
percentages set forth.
       The restated trust did not have an exhibit A attached to it,
and no such exhibit A has ever been found. But in a pocket of the
estate planning binder containing the restated trust, Breslin
found a document titled “Estates Charities (6/30/2017).” The
document listed 24 charities with handwritten notations that
appear to be percentages.
       Breslin filed a petition in the probate court to confirm him
as successor trustee and to determine the beneficiaries of the

      1The nonparticipating parties are: Pacific Legal
Foundation, Judicial Watch, Save the Redwoods League,
Concerned Women of America, Catholics United for Life, Catholic
League, Sacred Heart Auto League, National Prolife Action
Center dba Liberty Counsel, and Orbis International.

                                 2.
trust in the absence of an attached exhibit A. Breslin served each
of the listed charities. Only three of the listed charities filed
formal responses. The Pacific parties did not.
       The probate court confirmed Breslin as successor trustee
and ordered mediation among interested parties, including
Kirchner’s intestate heirs and the listed charities. One of the
listed charities, the Thomas More Law Center (TMLC), sent
notices of the mediation to all the interested parties, including
the Pacific parties.
       The mediation notices included the following:
       “Mediation may result in a settlement of the matter that is
the subject of the above-referenced cases and of any and all
interested·persons' and parties' interests therein. Settlement of
the matter may result in an agreement for the distribution of
assets of the above-referenced Trust and of the estate of Don F.
Kirchner, Deceased, however those assets may be held.
Settlement of the matter may also result in an award of
attorneys' fees to one or more parties under Smith v. Szeyller
(2019) 31 Cal.App.5th 450. Interested persons or parties who do
not have counsel may attend the mediation and participate.
       “Non-participating persons or parties who receive notice of
the date, time and place of the mediation may be bound by the
terms of any agreement reached at mediation without further
action by the Court or further hearing. Smith v. Szeyller (2019)
31 Cal.App.5th 450. Rights of trust beneficiaries or prospective
beneficiaries may be lost by the failure to participate in
mediation.
       “All represented parties (or his, her or their counsel) and all
unrepresented parties that intend to participate in the mediation
are requested to advise the undersigned of his, her or their

                                  3.
intention to be present and participate by making contact via
either email . . . or U.S. Mail. Notice to participate in mediation
will not be accepted via telephone.”
      Only five of the listed charities appeared at the mediation,
including TMLC. The intestate heirs also appeared. The Pacific
parties did not appear. The appearing parties reached a
settlement. The settlement agreement awarded specific amounts
to various parties, including the appearing charities, and
attorney fees with the residue to the intestate heirs. The
agreement excluded the Pacific parties.
      Breslin filed a petition to confirm the settlement. When the
Pacific parties received notice of the petition, they filed
objections.
      Prior to the hearing on the petition, Breslin filed a
supplemental declaration stating that he found the original trust
document. The restated trust had no exhibit A attached, but he
found attached to the original trust an exhibit A listing the same
charities as were found on the document in the binder with the
restated trust.
      The probate court granted Breslin’s petition to approve the
settlement. The court denied the Pacific parties’ objections on the
ground that they neither filed a response to Breslin’s petition to
determine the beneficiaries nor appeared at the mediation.
      The Pacific parties appeal.
                            DISCUSSION
                                   I
                          Standard of Review
      The Pacific parties contend that because the issues here do
not involve findings of fact, the standard of review is de novo.
The standard of review for the probate court’s approval of a

                                4.
settlement is abuse of discretion. (Estate of Green (1956) 145
Cal.App.2d 25, 28.) The dispute is academic, however. The
result is the same under either standard.
                                  II
                         Forfeiture of Rights
       The probate court has the power to order the parties into
mediation. (See Prob. Code,2 § 17206 [“The court in its discretion
may make any orders and take any other action necessary or
proper to dispose of the matters presented by the petition”].) The
court did so here. The Pacific parties received notice of the
mediation, but chose not to participate.
       In Smith v. Szeyller, supra, 31 Cal.App.5th 450, 458, we
held that a party who chooses not to participate in the trial of a
probate matter cannot thereafter complain about a settlement
reached by the participating parties. The Pacific parties point
out that there was no trial here. True, but the mediation ordered
by the probate court, like the trial in Smith, was an essential part
of the probate proceedings. The Pacific parties may not ignore
the probate court’s order to participate in the proceedings and
then challenge the result. The probate court’s mediation order
would be useless if a party could skip mediation and challenge
the resulting settlement agreement.
       The Pacific parties complain they were denied an
evidentiary hearing. But the probate court has the power to
establish the procedure. (§ 17206.) It made participation in
mediation a prerequisite to an evidentiary hearing. By failing to
participate in the mediation, the Pacific parties waived their
right to an evidentiary hearing. It follows that the Pacific parties
were not entitled to a determination of factual issues, such as

      2   All statutory references are to the Probate Code.

                                   5.
Kirchner’s intent, and cannot raise such issues for the first time
on appeal. (Ehrlich v. City of Culver City (1996) 12 Cal.4th 854,
865, fn. 4 [court will not address issues raised for the first time on
appeal].)
       Estate of Bennett (2008) 163 Cal.App.4th 1303, 1310, is of
no help to the Pacific parties. There the Court of Appeal held
that estate beneficiaries who petitioned to set aside a settlement
agreement were entitled to an evidentiary hearing. But Bennett
did not involve a party’s failure to respond to a mediation order.
       The Pacific parties argue the only way they can forfeit their
interest is by filing a written disclaimer. They rely on section
275. That section provides, “A beneficiary may disclaim any
interest, in whole or in part, by filing a disclaimer as provided in
this part.” (Ibid.) The disclaimer must be in writing signed by
the disclaimant. (§ 278.) But no one contends or even suggests
the Pacific parties disclaimed their interest. Instead, they
forfeited their interest when they failed to participate in
mediation as ordered by the court.
                                  III
                            Trustee’s Duties
                           (a) Impartiality
       The Pacific parties contend the trustee failed in his duty to
deal impartially with all beneficiaries. (§ 16003 [“If a trust has
two or more beneficiaries, the trustee has a duty to deal
impartially with them”].)
       But all interested parties received notice of the mediation
and had an opportunity to participate. The Pacific parties’
failure to participate was not the fault of the trustee.

                                  6.
                     (b) Trustee’s Personal Profit
        The Pacific parties contend the trustee breached fiduciary
duties by approving large gifts to Kirchner family members,
including himself, who stood to gain little or nothing under the
trust.
        But all parties who participated in the mediation approved
the settlement, not just the trustee. The Pacific parties may not
refuse to participate and then complain that they received
nothing.
        Moreover, the Pacific parties’ argument assumes the
beneficiaries of the trust are known. The court did not determine
the identity of the beneficiaries. The Pacific parties may have
requested an evidentiary hearing on the matter had they abided
by the probate court’s order and participated in the mediation.
They chose not to do so.
                               (c) Notice
        The Pacific parties contend that the trustee failed to keep
them reasonably informed about the mediation and his intent to
execute the settlement agreement.
        The Pacific parties do not claim they had no notice of the
mediation. Had they participated, they would have been fully
informed of all the developments, including the trustee’s
willingness to sign the settlement agreement.
        The Pacific parties apparently believe the trustee and
participating parties should have gone through mediation,
reached a settlement, and, before the settlement was signed,
notified the Pacific parties so that they could come in and object.
That would have made the mediation a waste of time, money, and
effort.

                                7.
      The Pacific parties cite section 16060 for the proposition
that the trustee has a duty to keep the beneficiaries of the trust
reasonably informed of the trust and its administration. The
information provided pursuant to section 16060 must be the
information reasonably necessary to enable the beneficiary to
enforce the beneficiary’s rights under the trust or prevent or
redress a breach of trust. (Salter v. Lerner (2009) 176
Cal.App.4th 1184, 1187.)
      First, the probate code did not determine that the Pacific
parties were beneficiaries of the trust. Second, assuming they
were beneficiaries, the notice of mediation was all the
information necessary for them to protect their interest.
      The Pacific parties argue that the mediation notice failed to
inform them that they could forfeit their interest if they did not
participate. But the notice stated that nonparticipating persons
or parties may be bound by the terms of any agreement reached
at the mediation, and the rights of trust beneficiaries or
prospective beneficiaries may be lost by the failure to participate
in the mediation.
      The Pacific parties argue that the loss of rights referred to
in the notice may be read as only referring to procedural rights.
But the notice says that nonparticipating parties may be bound
by any agreement reached during mediation. The notice
obviously refers to substantive rights.
                                  IV
                           Extrinsic Fraud
      The Pacific parties contend the probate court’s order
approving the settlement should be set aside for extrinsic fraud.
      The Pacific parties’ contention is based on TMLC’s response
to the trustee’s petition to determine trust beneficiaries. TMLC

                                8.
urged the probate court to find that the charities listed on the
paper found with the restated trust are the beneficiaries. TMLC
also requested attorney fees if successful because all the charities
listed would benefit by its success.
       TMLC was not claiming to be the legal representative for
all the charities on the list. It was only claiming that by
representing its own interest other parties will benefit and
should share in the burden of attorney fees under the substantial
benefit doctrine. (See Smith v. Szeyller, supra, 31 Cal.App.5th at
p. 460.) There was no extrinsic fraud.
                                   V
                             Attorney Fees
       The intestate beneficiaries contend they should be awarded
attorney fees under the substantial benefit doctrine. That is a
matter to be decided by the probate court.
                            DISPOSITION
       The judgment (order) is affirmed. Costs are awarded to
respondents.
       CERTIFIED FOR PUBLICATION.

                                      GILBERT, P. J.
We concur:

             YEGAN, J.                TANGEMAN, J.

                                 9.
                    Robert L. Lund, Judge

               Superior Court County of Ventura

                ______________________________

     Ferguson Case Orr Paterson, Joshua S. Hopstone and
David B. Shea for Defendants and Appellants Pacific Legal
Foundation, Judicial Watch, Save the Redwoods League,
Concerned Women of America, Catholics United for Life, Catholic
League, Sacred Heart Auto League, National Prolife Action
Center and Orbis International.

     Staker Law Tax and Estate Planning Law Corporation,
Kevin G. Staker and Brandon P. Johnson for Plaintiff and
Respondent David Breslin, Trustee.

     Jones, Lester, Schuck, Becker & Dehesa, Mark A. Lester,
Katherine H. Becker and Eric A. Hirschberg, for Defendants and
Respondents Paul G. Breslin and Kathleen Breslin LaForgia.

                              10.