Court Opinion

ID: 856309
Source: CourtListenerOpinion
Date Created: 2013-03-26 21:10:19.628588+00
Date Added: 2024-06-11T11:46:07.637249
License: Public Domain

Filed 3/26/13 In re Hartenstein Family Trust CA2/4
               NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
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           IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                                   SECOND APPELLATE DISTRICT

                                                DIVISION FOUR

In re the POLA HARTENSTEIN                                           B240493
FAMILY TRUST                                                         (Los Angeles County
                                                                     Super. Ct. No. BP125686)

CHARLENE HARTENSTEIN et al.,

         Plaintiffs and Appellants,

         v.

FELICE HARTENSTEIN,

         Defendant and Respondent.

         APPEAL from a judgment of the Superior Court of Los Angeles County.
Mitchell L. Beckloff, Judge. Reversed and remanded with directions.
         Mansell & Mansell and Cheryl B. Mansell; Law Offices of Philip R.
Homsey II and Philip R. Homsey II for Plaintiffs and Appellants.
         Law Offices of Tracey P. Hom and Tracey P. Hom for Defendant and
Respondent.
       In the underlying action regarding the enforcement of a trust instrument, the
trial court found that the instrument allocated the interests in a house in equal
shares to two trusts. Appellants contend that the instrument requires the house to
be allocated entirely to one of the trusts. We conclude that they are correct, and
therefore reverse.

         RELEVANT FACTUAL AND PROCEDURAL BACKGROUND
       A. 1998 Trust Instrument
       Uri and Pola Hartenstein were married for more than 50 years. They had
three children, respondent Felice Hartenstein, and appellants Charlene Hartenstein
and Annette Hartenstein-Schultz.1
       In December 1998, Uri and Pola executed a trust instrument prepared by
attorney Phillip Tangalakis. The instrument established a simple trust for their
assets, and designated them as co-trustees while they both remained alive. Upon
Uri’s or Pola’s death, the instrument provided for the allocation of the trust’s assets
into two subtrusts, an exemption trust and a survivor’s trust, with the goal of
“eliminat[ing] or . . . reduc[ing]” federal estate taxes without “impair[ing]” the
federal marital deduction. The survivor, as sole trustee, was authorized to amend,
revoke, or terminate only the survivor’s trust; the exemption trust became
irrevocable. Upon the survivor’s death, appellants and respondent were to receive
equal shares of the assets in the exemption trust, as well as equal shares of the
assets in survivor’s trust, unless it had been amended or revoked.
       Uri died in November 2000, rendering Pola the surviving spouse and sole
trustee. When Uri died, the trust’s only asset was Uri and Pola’s house.

1
        Because the parties and their parents share their surname, we refer to them by their
first names.

                                             2
      B. Attempted Revocation of Exemption Trust
      In March 2004, Pola executed a trust modification, providing that the
exemption trust would not be funded, and that only the survivor’s trust would
remain in existence. Later, in April 2004, she executed other documents
purporting to revoke the exemption and survivor’s trusts, create a new trust, and
disinherit appellants; in addition, she executed a grant deed transferring the house
to the new trust. Under the documents, Pola and Felice were to be co-trustees of
Pola’s 2004 trust, and Felice was to be its sole beneficiary upon Pola’s death.
Attorney Tangalakis prepared the trust modification and the other documents
establishing the 2004 trust.

      C. Underlying Action
      Pola died in July 2010. On November 22, 2010, appellants filed a petition
challenging the 2004 trust and the purported revocation of the 1998 exemption
trust. They contended that under the 1998 trust instrument, the exemption trust
became irrevocable upon Uri’s death, and that Pola was required to fund it to the
full extent of $675,000 federal estate tax credit effective when Uri died.2 In
opposing the petition, respondent maintained that the instrument did not require
Pola to allocate any assets to the exemption trust, and that its funding was left to
her discretion.
      A bench trial on the petition occurred in January 2012. During the trial, the
parties stipulated that at the time of Uri’s death, the house was worth less than
$675,000. Although the parties also stipulated that the terms of the 1998 trust
instrument were “clear and unambiguous,” Tangalakis testified regarding Uri’s and

2
      Appellants’ petition alleged that when Uri died, the value of the house was
$900,000.

                                            3
Pola’s intent in executing the instrument, and appellants submitted expert
testimony bearing on its meaning. Appellants argued that under the 1998 trust
instrument, the house was an asset of the exemption trust because its value when
Uri died was less than the estate tax credit at that time. In contrast, respondent
asserted that the house had been consigned to the survivor’s trust, which was
subject to amendment and revocation by Pola.
      Following the presentation of evidence, the trial court issued a ruling
expressly predicated on the parties’ stipulation that the 1998 trust instrument was
clear and unambiguous. The court concluded that the instrument required equal
interests in the house to be allocated to the exemption trust and the survivor’s trust;
in addition, the court determined that the provisions of Pola’s 2004 trust purporting
to revoke the exemption trust were void. The court further found that respondent,
as trustee of the 2004 trust, was the constructive trustee of a 50 percent interest in
the house and 50 percent of the income from the house arising after Pola’s death.
The court ordered respondent to execute a grant deed conveying a 50 interest in the
house to the trustees of the exemption trust, and to deliver to them 50 percent of
the house’s income arising after Pola’s death. The court also confirmed appellants
and respondent as the successor co-trustees of the exemption trust.

                                    DISCUSSION
      Appellants contend the trial court erred in determining that the 1998 trust
instrument requires the allocation of equal interests in the house to the exemption
and survivor’s trusts. They argue that the instrument mandates that the house be
allocated entirely to the exemption trust. As explained below, we agree.

                                           4
        A. Governing Principles
        Appellant’s contention requires us to interpret the 1998 trust instrument.
Generally, “‘“[i]n construing trust instruments, as in the construction and
interpretation of all documents, the duty of the court is to first ascertain and then, if
possible, give effect to the intent of the maker.” [Citations.]’ [Citation.] ‘[Probate
Code s]ection 21102 provides, “[T]he intention of the transferor as expressed in the
instrument controls the legal effect of the dispositions made in the instrument.”’
[Citations.] ‘“In construing a trust instrument, the intent of the trustor prevails and
it must be ascertained from the whole of the trust instrument, not just separate parts
of it.” [Citations.]’ [Citation.]” (Estate of Cairns (2010) 188 Cal.App.4th 937,
944.)
        Ordinarily, “[t]he interpretation of a will or trust instrument presents a
question of law unless interpretation turns on the credibility of extrinsic evidence
or a conflict therein.” (Burch v. George (1994) 7 Cal.4th 246, 254.) Here, the trial
court heard testimony regarding the instrument, but its analysis of the instrument
begins by referring to the stipulation, contains no discussion of the trial testimony,
and focuses exclusively on the language of the instrument. Because the court
found no ambiguity in the instrument, we also construe the instrument in light of
its language. (McAllister v. Metzger (1963) 220 Cal.App.2d 692, 702-703.) Our
review is thus de novo. (Ibid.)
        Under the circumstances, our task is to determine the trustors’ intent at the
time the instrument was executed (Brown v. Labow (2007) 157 Cal.App.4th 795,
812), as shown by the face of the document (Mummert v. Security-First Nat. Bank
(1960) 183 Cal.App.2d 195, 199 (Mummert)). Generally, we will give the words
of the instrument “their ordinary and grammatical meaning.” (Prob. Code,
§ 21122.) However, as the parties stipulated that an attorney prepared the

                                            5
instrument, we may infer that legal terms in it are used in their technical sense.
(Estate of McKenzie (1966) 246 Cal.App.2d 740, 744.)
      Our inquiry requires us to construe provisions involving the federal estate
tax credit and marital deduction. Generally, federal law establishes a credit that is
applied against the value of a decedent’s gross estate, for purposes of determining
federal estate tax. (26 U.S.C. §§ 2001, 2010(a); see Ike v. Doolittle (1998) 61
Cal.App.4th 51, 60 (Ike).) At trial, the parties stipulated that the value of this
credit when Uri died was $675,000.
      For purposes of determining federal estate tax, federal law also establishes a
marital deduction “consisting of a deduction from a decedent’s gross estate of the
value of property interests passing from the decedent to his surviving spouse.”
(Estate of Libeu (1988) 205 Cal.App.3d 1436, 1445; 26 U.S.C. § 2056.) Under the
marital deduction, certain property belonging to the decedent “is excluded from the
decedent’s gross estate for purposes of federal estate taxes; however, the property
so excluded must then be included in the surviving spouse’s estate for federal tax
purposes when he or she dies. (26 U.S.C. § 2056(a), (b)(7)(A)(i).)” (McIndoe v.
Olivos (2005) 132 Cal.App.4th 483, 489 (McIndoe).) At trial, the parties stipulated
that the value of this deduction when Uri died was unlimited.

      B. 1998 Trust Instrument
      We turn to the main provisions of the 1998 trust instrument. Article I, which
establishes the original trust, identifies the property that Uri and Pola agreed to
assign to the trust. Paragraph G of that article further states: “[The] Trustors
declare that all property that may be included in this Trust Estate as their
community property and all property transferred into this Trust shall retain its
character as such regardless of the transfer[,] and in the event that this Trust[] in
any way fails, and said community property is returned to the Trustors, it shall be
                                           6
returned as their community property and not as the separate property of either or
both Trustors.”
        The provisions governing the subtrusts are found in Articles II, III, and IV.
Paragraph B of Article II provides that upon the death of the first trustor, the
original trust was to be split into two distinct trusts, the survivor’s trust and the
exemption trust. Paragraph C of Article III further states: “Upon the Deceased
Spouse’s death the Surviving Spouse may amend, revoke[,] or terminate the
Survivor’s Trust; but the Exemption Trust may not be amended, revoke[d] or
terminated.” Paragraph A of Article IV further specified that after the surviving
spouse died, appellants and respondent were to receive equal shares of the assets in
the exemption trust, as well as equal shares of the assets in the survivor’s trust,
unless it had been revoked or terminated.
        Article II contains the key provisions governing the allocation of assets to
the two trusts. Pertinent here are the first and third subparagraphs of Paragraph C,
each of which concerns the survivor’s trust. The first subparagraph states: “The
Survivor’s Trust shall consist of Trust assets equal in value to the minimum
pecuniary amount necessary to entirely eliminate, or to reduce to the maximum
extent possible, any federal estate tax at Trustor’s death. In making this
determination, the Trustee shall take into consideration all Federal Estate Tax
deductions and all Federal Estate Tax credits other than those for State Death
Taxes.” The third subparagraph states: “The Trustee shall not allocate to [the]
Survivor’s Trust assets having an aggregate fair market value at the date of
allocation that is less than the marital deduction amount as finally determined for
Federal Estate Tax purposes.”3

3
      The second subparagraph of paragraph C, which also concerns the survivor’s trust,
provides: “This allocation to [the] Survivor’s Trust shall be satisfied in cash or in kind,
(Fn. continued on next page.)

                                            7
       Paragraph D, which concerns the exemption trust, provides in pertinent part:
“The Exemption Trust shall consist of the balance of the Trust Estate plus any
amount disclaimed on behalf of the surviving spouse . . . .”
       Article II also describes the purpose underlying the creation of the survivor’s
trust. Paragraph J states: “It is the Trustor[s’] intention to have the Survivor’s
Trust qualify for the marital deduction under the Internal Revenue Code Section
2056 [(26 U.S.C. § 2056)] and regulations pertaining thereto . . . . In no event shall
the Trustee take action or have any power that will impair the marital deduction,
and all provisions regarding the Survivor’s Trust shall be interpreted to this
primary objective.”
       The issues in the underlying action concerned Uri’s and Pola’s intent in
adopting this type of trust structure. Viewed as a totality, the trust instrument
reveals Uri’s and Pola’s intent to pair an irrevocable subtrust that potentially took
advantage of the estate tax credit (the exemption trust) with a subtrust that made
similar use of the marital deduction (the survivor’s trust). Typically, this type of
trust structure is employed by married trustors to control the disposition of their
property after their death while making some provision for the living spouse
through the marital deduction. (See McIndoe, supra, 132 Cal.App.4th at pp. 488-
489; Ike, supra, 61 Cal.App.4th at pp. 61-62.) The structure permits a trustor to
ensure that after his or her death, designated children will inherit the assets placed
in the irrevocable trust designed to draw on the estate tax credit. (McIndoe, supra,
at pp. 488-489; Ike, supra, at p. 61.) However, as explained below, during the
underlying proceedings, respondent denied that Uri and Pola intended the 1998

or partly in each, only with assets eligible for the marital deduction. Assets allocated in
kind shall be deemed to satisfy this amount on the basis of their values as finally
determined for Federal Estate Tax purposes.”

                                              8
trust instrument to assure their children’s equal inheritance through the exemption
trust.

         C. Underlying Proceedings
         At trial, appellants contended that Pola was required to allocate the house in
its entirety to the exemption trust. They identified the controlling provision as the
first subparagraph of paragraph C in Article II, which states in pertinent part:
“[The] Survivor’s Trust shall consist of Trust assets equal in value to the minimum
pecuniary amount necessary to entirely eliminate, or to reduce to the maximum
extent possible, any federal estate tax at the Trustor’s death.” (Italics added.) As
appellants noted, because the value of the house at Uri’s death was less than the
$675,000 federal estate tax credit, no federal estate tax was owed when he died.
Pointing to the italicized portion of paragraph C, they argued that the survivor’s
trust was to receive no assets, as it was unnecessary to allocate any assets to it in
order to eliminate the federal estate tax because “the minimum pecuniary amount
necessary” to eliminate the tax was $0.
         In contrast, respondent contended that all the assets in the original trust were
to be allocated to the survivor’s trust upon Uri’s death, with the exception of any
assets Pola elected to place in the exemption trust. Respondent relied on the third
subparagraph of paragraph C in Article II, which states: “The Trustee shall not
allocate to [the] Survivor’s Trust assets having an aggregate fair market value at
the date of allocation that is less than the marital deduction amount as finally
determined for Federal Estate Tax purposes.” (Italics added.) In addition, she
pointed to paragraph D in that article, which provides that the exemption trust shall
receive the balance of the estate “plus any amount disclaimed on behalf of the
surviving spouse.” (Italics added.) Respondent argued that because the marital
deduction was unlimited when Uri died, the italicized portion of paragraph C
                                             9
required all the trust assets to be allocated initially to the survivor’s trust; in
addition, she argued that under paragraph D, the exemption trust was to receive
only those assets that Pola affirmatively disclaimed.
       The trial court rejected respondent’s interpretation of the trust instrument,
insofar as respondent maintained that the house was to be allocated in its entirety
to the survivor’s trust. The court also agreed with appellants’ interpretation in part,
stating: “As there was no estate tax due at Uri’s death, . . . the minimum pecuniary
amount necessary to eliminate the tax considering the Federal Estate tax credit was
zero. Thus, pursuant to the first [subparagraph of paragraph C], no assets were
required to be allocated to the Survivor’s Trust . . . .”
       Nonetheless, the trial court concluded that appellants’ interpretation
improperly disregarded the third subparagraph of paragraph C. In ruling that equal
interests in the house were to be allocated to the subtrusts, the court stated that the
portion of the third subparagraph italicized above “sets a minimum value” on the
assets to be allocated to the survivor’s trust. The court further reasoned: “[E]ven
though the minimum pecuniary amount necessary to avoid [the] federal estate tax
was zero, . . . the trustee must allocate assets valued at the marital deduction to the
Survivor’s Trust. [¶] Here, . . . the marital deduction was unlimited. The only
property held by Uri at the time of his death was his one-half community property
interest in the . . . home. As only a deceased spouse’s property qualifies for the
marital deduction, the marital deduction amount would be Uri’s one-half interest in
the . . . home. [¶] Accordingly, . . . the Survivor’s Trust was required to be funded
with a value equal to one-half of the community property or a 50 percent interest in
the . . . home.”

                                            10
      D. Analysis
      For the reasons explained below, we agree with appellants that the 1998 trust
instrument required the house to be allocated entirely to the exemption trust. In
interpreting the instrument, we seek a construction that respects the language used
(Huscher v. Wells Fargo Bank (2004) 121 Cal.App.4th 956, 972), and avoids
rendering key phrases as surplusage (Comstock v. Corwin (1952) 111 Cal.App.2d
770, 772-773).
      Although the trust instrument provided that Uri’s and Pola’s community
property retained that character in the trust, Pola was obliged to transfer her
community property interest in the house from the original trust to the exemption
trust if required to do so under the instrument. (Aguilar v. Aguilar (2008) 168
Cal.App.4th 35, 38-39; Prob. Code, § 104.) We therefore focus our inquiry on the
instrument’s terms regarding the allocation of assets. Here, the controlling
provisions are paragraphs C and D of Article II, as each attends to a particular
subtrust and begins by stating that the subtrust “shall consist” of specified assets
from the original trust.
      Of the two provisions, paragraph C must be viewed as preeminent because
paragraph D, which addresses the exemption trust, refers to “the balance” of assets
not allotted to the survivor’s trust under paragraph C. The initial sentence of
paragraph C, by its plain language, identifies the exact amount of assets to be
placed in the survivor’s trust: it states that the survivor’s trust shall consist of
assets “equal in value to the minimum pecuniary amount necessary” to eliminate
the federal estate tax. (Italics added.) As no federal estate tax was due upon Uri’s
death, the “minimum pecuniary amount necessary” to be allocated to the survivor’s
trust in order to eliminate such estate tax was zero. Accordingly, the effect of the

                                           11
initial sentence was to dictate that the survivor’s trust receive no assets from the
original trust.4
       Viewed in context, the third subparagraph of paragraph C does not modify
the allocation specified in the first sentence of paragraph C. The third paragraph
states: “The Trustee shall not allocate to [the] Survivor’s Trust assets having an
aggregate fair market value at the date of allocation that is less than the marital
deduction amount as finally determined for Federal Estate Tax purposes.” As the
italicized terms indicate, the third subparagraph prohibits the trustee from
allocating to the survivor’s trust any assets whose total value on the date of the
allocation is less than the amount of the marital deduction “as finally determined,”
for purposes of the federal estate tax.
       In light of the phrase “as finally determined,” the latter amount must be
regarded as Uri’s actual marital deduction. Neither the unlimited marital
deduction specified in federal law (as proposed by respondent) nor the one-half
community property interest in the house that Uri theoretically could have claimed
(as proposed by the trial court) satisfy the terms of the third subparagraph, as those
sums are not the product of a “final[]” determination. Here, Uri’s federal estate tax
credit shielded his one-half community property interest in the house from federal
estate tax, leaving no assets subject to the marital deduction. Because Uri’s actual

4
        We note that this conclusion comports with paragraph D, which provides in full:
“The Exemption Trust shall consist of the balance of the Trust Estate plus any amount
disclaimed on behalf of the surviving spouse, in the amount equal to the maximum sum
that can be allocated to a Trust that does not qualify for the Federal Estate Marital
deduction to any extent without producing any Federal Estate Tax, after taking into
account, all Federal Estate Tax deductions and all Federal Estate Tax credits, to which
the Trust may be entitled to.” (Italics added.) In view of the italicized terms, paragraph
D appears to require that the exemption trust be funded with assets up to a defined
maximum, namely, the point at which the total value of its assets equaled the federal
estate tax credit.

                                            12
marital deduction was $0, the third subparagraph imposes no requirement on the
trustee regarding the allocation of assets to the survivor’s trust. Accordingly, it
did not oblige the trustee to allot any assets to that trust.
       We find additional support for our conclusion regarding the third
subparagraph from Internal Revenue Service (IRS) Revenue Procedure 64-19,
1964-1 C.B. 682 (Revenue Procedure 64-19).5 This procedure states requirements
for the availability of the marital deduction when “the governing instrument”
requires a trustee to select assets to be distributed. (Id. at §§ .01 - .02.) As
explained below, the third paragraph is reasonably viewed as intended to ensure
that the survivor’s trust satisfied the procedure’s requirements regarding the
marital deduction.
       Under Revenue Procedure 64-19, the marital deduction will be allowed
when the trust instrument obliges the trustee to transfer a decedent’s assets “having
an aggregate fair market value at the date . . . . of distribution amounting to no less
than the amount of the pecuniary [amount of] . . .[the] transfer, as finally
determined for Federal estate tax purposes.” (Id. at §§ .01 - .02.) The procedure
thus makes the marital deduction available when the trustee must allocate assets
whose value when allocated is not less than their value for purposes of the marital

5
       Although appellants argued before the trial court that Revenue Procedure 64-19
supported their interpretation of the trust instrument, they never asked the trial court to
take judicial notice of it, and no copy of it is found in the record. Instead, appellants
attached a copy of Revenue Procedure 64-19 as an exhibit to their opening brief, but did
not request that we take judicial notice of it. We proposed to take judicial notice of it on
our motion, and invited respondent to submit an opposition. Respondent’s letter
contained no argument that judicial notice is inappropriate, but instead challenged
appellants’ interpretation of the trust instrument. As our review is de novo and
respondent has had a full opportunity to discuss the relevance of Revenue Procedure 64-
19, we conclude that we may properly take judicial notice of it, and do so. (Shamsian v.
Atlantic Richfield Co. (2003) 107 Cal.App.4th 967, 975, fn. 5; Freis v. Soboroff (2000)
81 Cal.App.4th 1102, 1104; Evid. Code, §§ 452, subd. (b), 459, subd. (d).)

                                             13
deduction, as finally determined for Federal estate tax purposes. Because the third
subparagraph in paragraph C reflects this requirement, the subparagraph is nothing
more than an attempt to ensure that the survivor’s trust qualifies for the marital
deduction. Accordingly, the third paragraph merely implements the trustors’
intention stated in paragraph J of Article II, namely, “to have the Survivor’s Trust
qualify for the marital deduction.”
      Respondent contends that we must accept the trial court’s interpretation of
the instrument because that interpretation was supported by the evidence presented
at trial. However, as explained above (see pt. B., ante), after hearing the evidence
at trial, the court referred solely to the parties’ stipulation that the instrument
contained no ambiguity. This was entirely proper. Generally, the decision whether
to admit extrinsic evidence to interpret a trust instrument involves a two-step
process: the court provisionally receives the evidence to determine whether the
instrument is “‘reasonably susceptible’” to the interpretation urged by a party; if it
is, the evidence is admitted for purposes of construing the instrument. (Estate of
Kaila (2001) 94 Cal.App.4th 1122, 1130-1133.)
      Our focus is on the trial court’s conclusion at the first step, which presents a
question of law, and is reviewed de novo. (Estate of Kaila, supra, 94 Cal.App.4th
at pp. 1130-1133.) At trial, the court heard testimony bearing on the instrument’s
meaning only from attorney Tangalakis and appellant’s expert, attorney Margaret
Lodise.6 Tangalakis testified in support of respondent’s interpretation, namely,
that the third subparagraph of paragraph C required the survivor’s trust to receive
all of the original trust’s assets upon Uris’ death. According to Tangalakis, he

6
       Although Charlene testified that she was present when Uri and Pola met with
Tangalakis to discuss the trust instrument, she provided no testimony regarding the
provisions of the instrument at issue here.

                                            14
prepared the instrument to reflect Uri’s and Pola’s intent, which was “to provide
the surviving spouse full discretion” over the trust estate. In contrast, Lodise
testified in support of appellants’ interpretation.
        We conclude that the trial court properly declined to credit Tangalakis’s and
Lodise’s testimony, for purposes of setting aside the parties’ stipulation. As
explained above, respondent’s interpretation of the instrument cannot be reconciled
with its structure and plain language. Furthermore, Lodise’s testimony was not
cognizable for a different reason, albeit one that is consistent with our conclusion
regarding the instrument’s proper interpretation: a lawyer’s opinion regarding the
meaning of a writing that she had no role in creating does not constitute substantial
evidence regarding its interpretation. (Devin v. United Services Auto. Assn. (1992)
6 Cal.App.4th 1149, 1157-1158, fn. 5; see Downer v. Bramet (1984) 152
Cal.App.3d 837, 841; Elder v. Pacific Tel. & Tel. Co. (1977) 66 Cal.App.3d 650,
664.)
        Respondent also contends that appellants’ interpretation of the trust
instrument must be rejected because it compels the allocation of Pola’s one-half
community property interest in the house to the irrevocable exemption trust. She
argues that Pola would not have agreed to that allocation, as it required her to give
up her rights over the house and potentially constituted a taxable event (see 26
C.F.R. § 25.2511-2(b) [for purposes of federal gift tax, gift is complete when “ the
donor has so parted with dominion and control as to leave in him no power to
change its disposition”]).
        This contentions fails in light of the terms of the instrument, which allocate
the house to the exemption trust, and are silent regarding the federal gift tax. As
explained above (see pt. B, ante), our task is limited to discerning Pola’s intent
from the trust instrument itself. Because the instrument is unambiguous, we will
not insert new terms or alter it to reflect an intent not manifested in it, or to address
                                           15
new desires or goals that arise only after its execution. (Mummert, supra, 183
Cal.App.2d at p. 199.) In sum, we conclude that the 1998 trust instrument required
the allocation of the house in its entirely to the exemption trust.

                                        DISPOSITION
      The judgment is reversed, and the matter is remanded to the trial court with
directions to vacate the judgment and enter a new judgment in favor of appellants,
in accordance with this opinion. Appellants are awarded their costs on appeal.
      NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

                                               MANELLA, J.

We concur:

EPSTEIN, P. J.

WILLHITE, J.

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