Court Opinion

ID: 9404974
Source: CourtListenerOpinion
Date Created: 2023-06-26 20:04:07.128469+00
Date Added: 2024-06-11T17:19:38.087396
License: Public Domain

Filed 6/26/23 Estate of Jones CA2/2
        NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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
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    IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                             SECOND APPELLATE DISTRICT

                                            DIVISION TWO

 Estate of DEBRA LYNNE                                       B319459
 JONES, Deceased.
                                                             (San Luis Obispo County
 BARRY VANDERKELEN, as                                       Super. Ct. No. 19PR0059)
 Administrator, etc.,

           Petitioner and Respondent,

           v.

 TOM W. JONES, Individually
 and as Trustee, etc.,

           Objector and Appellant.

 TOM W. JONES, Individually                                  (San Luis Obispo County
 and as Trustee, etc.,                                       Super. Ct. No. 20PR0059)

           Plaintiff and Appellant,

           v.

 BARRY VANDERKELEN, as
 Administrator, etc.,

           Defendant and Respondent.
     APPEAL from a judgment of the Superior Court of San Luis
Obispo County, Hernaldo J. Baltodano, Judge. Affirmed.
     M. Jude Egan for Objector and Appellant and Plaintiff and
Appellant.
     Carmel & Naccasha and Victor J. Herrera for Petitioner and
Respondent and Defendant and Respondent.

           _____________________________________________

      Tom W. Jones (Tommy) seeks to reverse a judgment of the
probate court interpreting the Jones Family Trust (Family Trust)
executed by his parents, Kenneth Jones (Kenneth) and Mary Jones
(Mary) naming Tommy and his sister, Debra L. Jones (Debbie) as
successor trustees and beneficiaries.1 The probate court ruled the
terms of the Family Trust required that when Debbie died intestate
some years after the deaths of her parents, her share of the Family
Trust was to pass to her estate. In so ruling, the court rejected
Tommy’s claim that Debbie’s failure to take full distribution of her
share prior to her death meant it lapsed and passed to him. We
conclude the court properly interpreted the Family Trust and affirm
the judgment.
          FACTUAL AND PROCEDURAL BACKGROUND
A.    Facts2
      In September 1977, Mary and Kenneth created the Family Trust.
It provides that Kenneth and Mary, as settlors, were also cotrustees;
that upon the death of either Kenneth or Mary, the surviving spouse

      1 For clarity and convenience, we use first names for the
individuals involved, as stated in the Family Trust and/or the parties’
briefs. The trust instrument also refers to Kenneth and Mary’s
children as “Tommy Jones” and “Debbie Jones.”
      2These facts are taken from the Joint Statement of Undisputed
Material Facts submitted by the parties and/or the trust instrument,
including Amendments and Schedules A–D.

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and settlor would become the sole trustee of the Family Trust; that
upon the death of the surviving spouse, Kenneth and Mary’s children
(Tommy and Debbie) would become cotrustees; and that upon the death
of either Debbie or Tommy, the surviving child of Kenneth and Mary
would become the sole trustee of the Family Trust.
       In April 1992, Kenneth and Mary amended and restated the
Family Trust, but the amendment did not alter the successor trustee
provisions. The trust instrument describes Debbie as an unmarried
adult with no children and Tommy as a married adult with two adult
children.
       Kenneth died in approximately 1993. Pursuant to the Family
Trust, Mary became the sole trustee upon his death, and the trust
estate was divided into two separate trust shares designated as Trust
“S” (Survivor’s Trust), containing Mary’s share, and Trust “C”
(Creditor’s Exemption Trust), containing Kenneth’s share.
       Mary amended the Family Trust in 2008 to create M.N. Jones
Properties, LP and M.N. Jones Associates, LLC, in which she, Tommy
and Debbie each held an ownership interest. At some point, Debbie
took some, but not all distributions from the Family Trust.
       On May 30, 2017, Mary died, and Tommy and Debbie became
cotrustees as well as beneficiaries. Each of the two beneficiaries was to
receive a 50 percent share of the Family Trust.
       On January 24, 2019, Debbie died intestate. Tommy became sole
successor trustee and beneficiary of the Family Trust.
B.     Underlying Litigation
       The underlying litigation consists of two consolidated probate
cases: The first case, Estate of Debra Lynne Jones (Super. Ct. San Luis
Obispo County, No. 19PR0059) (Debbie’s Estate) involved a Probate
Code section 850 petition to establish Debbie’s Estate’s claim of
ownership to property and for an order directing its transfer to Debbie’s
Estate. The second case, In re Jones Family Trust of 1977 (Super. Ct.
San Luis Obispo County, No. 20PR0059), involved the Family Trust’s
petition for final distribution of the trust assets to the sole beneficiary
and termination of the trust without accounting.

                                    3
       The parties, Barry VanderKelen, the administrator of Debbie’s
Estate (administrator), and Tommy, the successor trustee and
beneficiary of the Family Trust, stipulated to having a consolidated
evidentiary hearing. The sole issue was whether Debbie’s Estate or
Tommy was entitled to her share of the Family Trust. At the
conclusion of the hearing, the court issued a written ruling finding for
Debbie’s Estate. The court ordered Tommy to transfer Debbie’s share
in the Family Trust to the administrator. Following entry of the
judgment, Tommy timely filed a notice of appeal.
                                DISCUSSION
A.     Standard of Review
       Where, as here, there is no conflict in the evidence, interpretation
of a trust instrument is a legal question reviewed de novo. (Estate of
Powell (2000) 83 Cal.App.4th 1434, 1439; Scharlin v. Superior Court
(1992) 9 Cal.App.4th 162, 168.)
B.     Debbie’s Estate Has Standing
       At the outset, we address and reject Tommy’s claim that Debbie’s
Estate lacks standing. “ ‘A litigant’s standing to sue is a threshold
issue to be resolved before the matter can be reached on the merits.’ ”
(Troyk v. Farmers Group, Inc. (2009) 171 Cal.App.4th 1305, 1345.)
Tommy did not raise a standing issue in the probate court.
Nonetheless, “[a] party’s standing can be raised at any time in the
litigation, even for the first time on appeal.” (Applera Corp. v. MP
Biomedicals, LLC (2009) 173 Cal.App.4th 769, 785.)
       According to Tommy, Debbie’s Estate lacks standing to contest
Debbie’s failure to distribute the Family Trust assets before her death
because it “is a claim by Debra against Debra.” This assertion has
nothing to do with whether Debbie’s Estate has standing to sue.
       “To have standing to sue, a person, or those whom he [or she]
properly represents, must ‘ “have a real interest in the ultimate
adjudication because [he or she] has [either] suffered [or] is about to
suffer any injury of sufficient magnitude reasonably to assure that all
of the relevant facts and issues will be adequately presented.” ’ ”
(Martin v. Bridgeport Community Assn., Inc. (2009) 173 Cal.App.4th

                                    4
1024, 1031–1032.) Debbie’s Estate, as represented by the
administrator, has an “ ‘actual and substantial interest’ ” in the
distribution of Debbie’s share of the Family Trust and would be injured
by an order that her share had lapsed and passed to Tommy. (Ibid.;
O’Flaherty v. Belgum (2004) 115 Cal.App.4th 1044, 1062.) [“An
executor or trustee of an estate is the real party in interest for purposes
of bringing a claim on behalf of those estates”].) The administrator,
acting on behalf of Debbie’s Estate, has standing in this case. (See
Prob. Code, § 9820;3 Code Civ. Proc., § 369, subd. (a).)
       Tommy also contends Kathy Barbee (Kathy) lacks standing.
Kathy is purportedly Debbie’s registered domestic partner from whom
Debbie was allegedly estranged. However, Kathy is not a party to
either the underlying consolidated suit or this appeal. We do not reach
any issues Tommy raises concerning Kathy or her interests.
C.     Debbie’s Estate Is Entitled to Her Distributive
       Share of the Trust4
       “The intention of the transferor as expressed in the instrument
controls the legal effect of the dispositions made in the instrument.”

      3Further statutory references are to the Probate Code unless
otherwise indicated.
      4 As a preliminary matter, we agree with the administrator that
our review of the record is limited to the pleadings, trial briefs, and
evidence before the probate court at the time of the evidentiary
hearing. The probate court “reviewed the pleadings in this
consolidated action including, but not limited to, the parties’ trial briefs
filed on November 3, 2021, supplemental trial briefs filed on
December 9 and 10, 2021, Tom’s separate statement of additional
material facts filed on December 9, 2021, and the parties’ joint
statement of undisputed material facts filed on December 10, 2021.”
We disregard (1) other evidence admitted in subsequent proceedings in
this consolidated case and submitted by Tommy as part of the record on
appeal, and (2) assertions of “fact” in Tommy’s opening brief
unsupported by evidence admitted at the hearing. (See Kendall v.
Barker (1988) 197 Cal.App.3d 619, 625 [“ ‘The appellate court is . . .
confined in its review to the proceedings which took place in the court
below and are brought up for review in a properly prepared record on

                                     5
(§ 21102, subd. (a).) “ ‘ “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.” ’ ” (Estate of Cairns
(2010) 188 Cal.App.4th 937, 944.) Tommy is not contending any
language of the trust instrument is ambiguous. Thus, we consider its
plain language, interpreting words in their ordinary and grammatical
sense, unless a different meaning can be clearly determined. (Huscher
v. Wells Fargo Bank (2004) 121 Cal.App.4th 956, 972; accord, Trolan v.
Trolan (2019) 31 Cal.App.5th 939, 949; § 21122.)
       The Family Trust consists of the Trust Declaration, articles I
through V containing one or more numbered paragraphs, and
Schedules A through D. Article II sets forth provisions for the
distribution of the Family Trust’s income and principal during the
lifetime of the settlors and upon the death of the surviving settlor.
Schedule D is the “Distribution of Residue” provision that is primarily
at issue. It comes into play because, before she died, Mary never
exercised her powers of appointment over the residue of Trusts C and S
under article II, paragraphs 2.7.2 and 2.7.3.
       Schedule D states:
       “Upon the death of the surviving Settlor, the successor Trustee(s)
then in office shall either continue or terminate the Trusts as follows:
       “As to Trust C, the balance then remaining shall be divided as
follows:
       “One-half to our daughter, DEBRA L. JONES.
       “One-half to our son, TOMMY W. JONES.
       “If Debbie Jones fails to survive to take distribution without
leaving surviving lineal issue, her share shall lapse and go to Tommy
Jones.

appeal.’ [Citation.] ‘Statements of alleged fact in the briefs on appeal
which are not contained in the record and were never called to the
attention of the trial court will be disregarded by this court on
appeal’ ”].)

                                    6
       “If Tommy Jones fails to survive to take distribution, his share
shall pass to his issue by right of representation.
       “AS TO TRUST S:
       “Trust S shall be modified, continued or terminated, as directed
by the surviving settlor. If no other direction is made, however, then it
shall be distributed to the same persons and in the same manner as
Trust C.”
       The plain meaning of Schedule D is that upon Mary’s death, the
interests of Tommy and Debbie in the Family Trust vested, such that
the two beneficiaries each had a 50 percent share in the residue of
Trusts C and S. Debbie satisfied Schedule D’s condition precedent of
surviving the surviving settlor to take distribution. Debbie’s Estate is
thus entitled to receive the balance of her interest in the Family Trust.
       In opposition, Tommy acknowledges in his opening brief that he
and Debbie “had vested rights in the [Family] Trust assets” upon
Mary’s death in 2017. Nonetheless, Tommy argues the probate court
ignored relevant provisions in the trust instrument that clearly show
the settlors intended: (1) that Debbie had to survive until distribution
was complete as a condition precedent; (2) that if Debbie died, her
share was to pass solely to the family’s lineal descendants. We discuss
each contention in turn.
       1.    Tommy’s claim that Debbie had to survive
             complete distribution
       Tommy argues Schedule D required Debbie to survive to take a
full distribution to receive her share of the remainder of Trusts C and
S. According to Tommy, given the option in Schedule D “ ‘to continue or
terminate’ ” the trusts upon Mary’s death, Debbie chose to continue the
trusts without taking a complete distribution before she died.
Consequently, Debbie “ ‘fail[ed] to survive to take distribution’ ” and
her Estate was not entitled to receive her share.
       Tommy’s position is simply wrong in several respects. Nothing in
the trust instrument gives either Tommy or Debbie the unilateral
authority to continue or terminate the Family Trust at his or her
discretion. Instead, Schedule D’s phrase that “the successor trustees

                                   7
. . . shall either continue or terminate” Trusts C and S relates to the
explicit requirements of other distributive provisions: Article II,
paragraphs 2.7.4, 2.7.5, 2.7.6, and 2.7.7 dictate the Family Trust is to
continue for the benefit of the settlors’ grandchildren or great
grandchildren of certain ages if either or both successor trustees fail to
survive the surviving settlor. If the requirements of these paragraphs
are met, then the Family Trust shall “continue” as “divided” between
Tommy and Debbie. Hence, the reference in Schedule D. However,
these four paragraphs do not control here because both Tommy and
Debbie survived Mary.
        On the other hand, article II, paragraphs 2.7.1, 2.7.2, and 2.7.3
address the termination of the Family Trust and distribution of the C
and S Trusts triggered by the death of the surviving settlor and
survival of successor trustees, which did occur here. Pursuant to these
paragraphs, the successor trustees shall terminate the Family Trust
and distribute “all of the then remainder of Trust S, together with the
remainder of Trust C” to Tommy and Debbie as directed in Schedule D.
Hence, Schedule D’s reference to the termination of the two trusts.
        We also find no support in the trust instrument for Tommy’s
claim that while Debbie had a right to her share as vested upon Mary’s
death, her failure to survive to take full distribution means her Estate
could not receive it. “Survive to take distribution” means to remain
alive after another person has died. (Burkett v. Capovilla (2003) 112
Cal.App.4th 1444,1450 [“In their ordinary usage, the terms ‘survive’
and ‘survivorship’ connote living past the date of another person’s
death”].) “Failed to survive to take” does not mean “survived but failed
to take,” as Tommy would have us determine.
        Finally, Tommy makes much of the concept of unreasonable
delay, relying on Estate of Taylor (1967) 66 Cal.2d 855 and Estate of
Justesen (1999) 77 Cal.App.4th 352. However, whether an
administrator or a probate court unreasonably delayed the distribution
of an estate, as discussed in those decisions, are not factual issues
before us. The two cases are inapplicable.

                                    8
     2.       Tommy’s contention that distribution to Debbie’s
              Estate is contrary to the settlors’ intent
      Tommy further contends the probate court’s ruling that Debbie’s
Estate was to receive her share of the Family Trust is contrary to the
settlors’ “plain subjective general intent” to keep the assets in the
family lineage. Tommy argues the effect of the court’s ruling is that
Kathy, Debbie’s domestic partner, will be awarded half of Debbie’s
Estate. However, as we previously stated, issues pertaining to Kathy
are not before us. Tommy is correct that Kenneth and Mary expressly
declared the Family Trust was created “for the benefit of themselves
and their descendants,” particularly for their two children. The
language of the trust instrument unambiguously states the family
assets are to pass in equal shares to Tommy and Debbie, which is what
happened here.
                              DISPOSITION
      The judgment awarding Debbie’s share of the Family Trust to
Debbie’s Estate is affirmed. The administrator of Debbie’s Estate is to
recover costs on appeal.
      NOT TO BE PUBLISHED.

                                         LUI, P. J.
We concur:

     ASHMANN-GERST, J.

     HOFFSTADT, J.

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