Court Opinion

ID: 3176888
Source: CourtListenerOpinion
Date Created: 2016-02-11 21:12:20.965508+00
Date Added: 2024-06-11T09:18:16.975875
License: Public Domain

Filed 2/11/16 Steinberg, as Trustee v. Steinberg CA2/8
                  NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.

              IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                                     SECOND APPELLATE DISTRICT

                                                 DIVISION EIGHT

NISAN STEINBERG, as Trustee, etc.,                                   B261480

         Plaintiff and Appellant,                                    (Los Angeles County
                                                                     Super. Ct. No. BP144659)
         v.

MARVIN STEINBERG et al.,

         Respondents.

         APPEAL from a judgment of the Superior Court of Los Angeles County.
Maria E. Stratton, Judge. Affirmed in part, reversed in part with directions.

         Marc B. Hankin; and Evan D. Marshall for Plaintiff and Appellant.

         No appearance for Respondents.

                                   _______________________________
       This appeal involves a trust created by Marvin Steinberg, who is still living.1
In 2013, Marvin was removed as trustee pursuant to a disability clause. His son Nisan
succeeded him in that position. Marvin subsequently married his second wife, Tamara
Beaver. Marvin’s family did not approve of the relationship and believed Tamara and
her associates were taking advantage of Marvin’s impaired cognition. As a result, Nisan
filed a conservatorship action in San Diego County Superior Court prior to filing the
present trust action in Los Angeles County. Acting as trustee and as Marvin’s power of
attorney, Nisan also amended the trust to disinherit Tamara and her associates from
sharing in Marvin’s estate. Finally, Nisan filed a petition to compel an accounting from
Tamara and her associates, whom he alleges dissipated Marvin’s income and assets.
       The probate court ruled that Nisan lacked the authority to amend the trust to
disinherit Tamara and it dismissed the petition to compel an accounting on the ground it
would more properly be resolved in the conservatorship action. Nisan appealed these
orders. Because the probate court should have transferred the petition to compel an
accounting to the court adjudicating the conservatorship action, we reverse the probate
court’s order dismissing the petition. We otherwise affirm the judgment.
                 FACTUAL AND PROCEDURAL BACKGROUND
       The Marvin B. Steinberg Living Trust was established on February 9, 1998.
It was replaced by a Second Amendment and Complete Restatement (second
amendment) Marvin executed on September 2, 2008, which established a process by
which the trust and its assets would be administered in the event of his disability or death.
Under the second amendment, a disability panel was created, consisting of Marvin’s three
children—Nisan Steinberg, Deborah Antler and Ellen Geatches—and his son in law,
Derek Antler. The disability panel was empowered to issue a “final, binding and
controlling” determination of disability, at which time Nisan would become the trustee.

1
      To avoid confusion, where appropriate we use the first names of family members.
We intend no disrespect by this informality. (Warfield v. Summerville Senior Living, Inc.
(2007) 158 Cal.App.4th 443, 445, fn. 1.)

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The second amendment also provided “[i]n the event that [Marvin became] disabled,
and unable to sign, an agent who has been named under a valid Power of Attorney shall
act on [his] behalf.” Marvin also executed a durable Power of Attorney on September 2,
2008, naming Nisan as his attorney in fact.2
       Marvin’s mental capacity began to deteriorate in or around 2011. Sometime in
2012, Marvin met Tamara Beaver and began a relationship with her. Marvin’s family
believed Tamara, an escort who advertised her services on the internet, was taking
advantage of Marvin. She alienated him from his family by convincing him that his
children wanted to put him in an institution. Not only did she move into Marvin’s home,
her longstanding boyfriend Kurt Van Gorder also moved in, ostensibly to provide 24-
hour care for Marvin. Tamara shared a bedroom with Van Gorder. Tamara also hired
several attorneys to represent Marvin, but the family believed the attorneys actually
worked only to further Tamara’s interests.
       In December 2012, Marvin advised his trust attorney he intended to marry Tamara
and asked about a prenuptial agreement. On April 9, 2013, the disability panel
unanimously found Marvin disabled. Despite the declaration of disability, Marvin
executed a fourth amendment (fourth amendment) to his trust on June 4, 2013, appointing
Tamara as co-trustee. Meanwhile, Nisan prepared an amendment to the second
amendment on June 30, 2013, which expressly disinherited Tamara and various other
people whom he believed were taking advantage of his father, including Van Gorder and
the attorneys hired by Tamara (Nisan’s amendment). Marvin revoked the durable power
of attorney as to Nisan on July 7, 2013. Marvin and Tamara married in 2013, when he
was 85 years old.
       On August 27, 2013, Marvin’s children filed a petition under Probate Code section
17000 for an order to validate the trust as it is stated in the second amendment, validate
the decision of the disability panel to remove Marvin as trustee and replace him with

2
       Ellen was also named as an attorney in fact, but she resigned on April 19, 2013.

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Nisan, invalidate the fourth amendment designating Tamara as co-trustee and validate
Nisan’s amendment disinheriting Tamara and others.
       The probate court assigned Marvin a guardian ad litem (guardian), who filed trial
briefs for the court’s consideration. The guardian and Nisan submitted a stipulation on
the truthfulness of facts and genuineness of documents for the probate court’s
consideration, which outline the facts presented above.
       In his trial brief, Marvin’s guardian reported there was no dispute that Marvin
knowingly established the second amendment and the disability panel acted in
accordance with the second amendment to remove Marvin as trustee. The guardian also
reported “Marvin suffered from delusional thinking when he executed the Fourth
Amendment on June 4, 2013 . . . Marvin believed that his family was trying to put him
away in an institution.” Thus, even if the disability panel lacked the authority to prevent
Marvin from making the fourth amendment, he lacked capacity to execute the fourth
amendment because he had significant mental function deficits and was subject to undue
influence by Tamara.
       However, the guardian noted the court in the conservatorship action has not seen
fit to remove Tamara from Marvin’s house and has had to order Nisan to provide weekly
grocery deliveries, pay for Marvin’s car, pay insurance, and provide money for gasoline
and spending money. The guardian recommended Nisan remain as trustee but that
Marvin’s trust be made subject to court supervision.
       On July 29, 2014, Nisan filed a petition in this case seeking to compel an
accounting from Tamara and her cohorts, alleging they had taken trust funds and co-
mingled trust and non-trust assets. The probate court found the second amendment to be
a valid and existing trust and the provisions creating the disability panel to be valid.
The court further found Nisan to be a duly appointed agent under the power of attorney
executed on September 2, 2008. It determined the disability panel validly removed
Marvin as trustee and therefore Marvin lacked capacity to execute the fourth amendment
appointing Tamara as co-trustee and revoking the durable power of attorney. However,
the court also ruled Nisan lacked authority to change the terms of the trust and his attempt

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to disinherit Tamara or any of her group was invalid. The probate court declined to take
the trust under court supervision and dismissed without prejudice the request for an
accounting, ruling that the matter should be heard in the conservatorship action. Nisan
appealed the probate court’s decision. We affirm the judgment. While we agree with the
probate court that the accounting should be heard in San Diego with the conservatorship
action, we find dismissal was not the appropriate remedy. We reverse the dismissal of
the petition to compel an accounting and remand the case to the probate court to instead
issue an order transferring the matter to the court hearing the conservatorship action in
San Diego County.
                                       DISCUSSION
       On appeal, Nisan challenges the probate court’s finding that he lacked authority to
execute Nisan’s amendment to restore the trust’s distribution as specified in the second
amendment. Nisan also contends the probate court abused its authority in dismissing the
petition for an accounting. No respondents’ briefs have been filed. California Rules of
Court, rule 8.220 allows an appellate court in such a situation to decide an appeal on the
record, the opening brief and any oral argument by the appellant. We examine the record
on the basis of appellant's brief and reverse only if prejudicial error is found. (Lee v.
Wells Fargo Bank (2001) 88 Cal.App.4th 1187, 1192, fn. 7.) We conclude the probate
court should have transferred the petition for an accounting to the conservatorship court,
but otherwise find no error.
I.     Nisan’s Amendment
       On June 30, 2013, Nisan executed an amendment to the trust which expressly
disinherited Tamara and her issue, “leaving them nothing.”3 Nisan contends he had the

3
        Nisan’s amendment also disinherited a number of named individuals associated
with Tamara, including Van Gorder and the attorneys who purportedly represented
Marvin. Given the probate court’s determination that Marvin lacks the capacity to amend
his trust, which has not been appealed, and that there is also no indication Marvin
intended to or did provide for any of the individuals named, we need not address Nisan’s
attempt to preemptively disinherit these individuals from the trust. “[A] case normally
must present an actual controversy between the parties before a court will entertain it.”

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authority to execute the amendment through his role as trustee and Marvin’s attorney-in-
fact. Nisan bases his authority on Article Four, section 1(d) of the second amendment
which states, “I shall have the absolute right to amend or revoke my trust, in whole or in
part, at any time. Any amendment or revocation must be in writing, signed by me,
notarized, and delivered to my Trustee. [¶] The right to amend or revoke my trust is
personal to me. In the event that I am disabled, and unable to sign, an agent who has
been named under a valid Power of Attorney shall act on my behalf.”
       On September 2, 2008, Marvin created a financial durable power of attorney,
which expressly authorized Nisan to create and amend revocable trusts. However, the
power of attorney expressly stated that such an amendment “shall not materially alter the
disposition of [Marvin’s] estate under an existing will or other inter vivos trust and the
distribution provisions of such created trust shall be made to the same persons, in the
same proportion and on the same terms as [his] estate would be distributed upon [his]
death under an existing will or trust.” Nisan contends the second amendment and the
power of attorney grant him the requisite authority to execute Nisan’s amendment
because it does not materially alter the disposition of his father’s estate under an existing
will or trust. We disagree.
       Nisan exceeded his authority to amend the trust because a distribution under
Nisan’s amendment would fail to distribute Marvin’s estate “in the same proportion and
on the same terms as [his] estate would be distributed upon [his] death under an existing
will or trust.” This is because the existing trust, namely the second amendment, predates
Marvin’s marriage to Tamara and she is entitled under the Probate Code4 to a share of
Marvin’s estate as an omitted spouse. Under section 21610, “if a decedent fails to
provide in a testamentary instrument for the decedent’s surviving spouse who married the
decedent after the execution of all of the decedent’s testamentary instruments, the omitted

(Stump’s Market, Inc. v. Plaza de Santa Fe Limited, LLC (2013) 212 Cal.App.4th 882,
892.)
4
       Further section references are to the Probate Code unless otherwise specified.

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spouse shall receive a share in the decedent’s estate. . .” unless one or more of the
exceptions in section 21611 applies.5 The express terms of the durable power of attorney
granted to Nisan limits his authority to amend the trust to disinherit Tamara.
       The Probate Code directs us to the same conclusion. In Schubert v. Reynolds
(2002) 95 Cal.App.4th 100 (Schubert), the father died, leaving four children and one
house. Two months before he died, he executed a general power of attorney designating
one of his daughters as his attorney-in-fact. This daughter created a trust in her father’s
name the day before he died which provided the house would be held in trust for her
benefit for her lifetime, the remainder to pass to the grandchildren. In creating the trust
and designating herself as the beneficiary, she effectively bypassed her three siblings,
who sued. (Id. at p. 102.) The court held the daughter lacked the authority to designate
herself as the beneficiary in contravention of the laws of intestate succession and the
terms of a previous will, which was lost. (Id. at pp. 105-106.)
       The court reached its decision by interpreting section 4264, which provides in
pertinent part: “An attorney-in-fact under a power of attorney may perform any of the
following acts on behalf of the principal or with the property of the principal only if the
power of attorney expressly grants that authority to the attorney-in-fact: (a) Create,
modify, revoke, or terminate a trust, in whole or in part. If a power of attorney under this
division empowers the attorney-in-fact to modify or revoke a trust created by the
principal, the trust may be modified or revoked by the attorney-in-fact only as provided
in the trust instrument . . . . [¶] . . . (f) Designate or change the designation of
beneficiaries to receive any property, benefit, or contract right on the principal’s death.”
(§ 4264, subds. (a) & (f).)

5
        Under section 21611, the omitted spouse shall not receive a share of the estate if
“(a) The decedent’s failure to provide for the spouse in the decedent’s testamentary
instruments was intentional and that intention appears from the testamentary instruments.
[¶] (b) The decedent provided for the spouse by transfer outside of the estate passing by
the decedent’s testamentary instruments and the intention that the transfer be in lieu of a
provision in said instruments is shown by statements of the decedent or from the amount
of the transfer or by other evidence. [¶] (c) The spouse made a valid agreement waiving
the right to share in the decedent’s estate.”

                                                7
       The Schubert court held an attorney-in-fact’s authority to create, modify, revoke,
or terminate a trust under subdivision (a) was constrained by the provision in subdivision
(f) prohibiting him from changing the designation of beneficiaries unless expressly
authorized to do so. The court explained, “An attorney-in-fact may create a trust when so
authorized by the terms of the power of attorney, but the power to designate particular
trust beneficiaries is limited. . . . Under those circumstances, the attorney-in-fact would
not be the one selecting the beneficiaries. In effect, they would be designated by either
the principal, pursuant to the principal’s original estate plan, or the Legislature, according
to the laws of intestate succession.” (Schubert, supra, at pp. 103-106.)
       Nisan is likewise constrained by section 4264, subdivision (f) to execute the
amendment disinheriting Tamara and her issue. The financial power of attorney in this
case granted Nisan the authority the power to create and amend revocable trust
agreements. However, it did not authorize Nisan to “[d]esignate or change the
designation of beneficiaries to receive any property, benefit, or contract right on the
principal’s death.” Tamara qualifies as an omitted spouse under section 21610. As in
Schubert, Nisan is not authorized to use his power of attorney to circumvent the
provisions of section 21610.
       Having determined Nisan’s amendment is invalid, we need not reach the question
of whether sufficient evidence demonstrates any of the exceptions listed under 21611
exist. As Marvin has not yet died, we cannot yet determine whether any exception
applies. Further, even if Tamara could be divested of her rights to Marvin’s estate under
a section 21611 exception, Nisan’s amendment would not be rendered valid as a result.
Nor do we address whether the trust could be amended or revised as part of the
conservatorship proceedings, whether the marriage is valid, or whether any of the
relevant instruments were procured by undue influence.

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II.    Accounting
       On July 29, 2014, Nisan filed a petition and complaint for an order compelling an
accounting of both trust and non-trust funds from Tamara, Van Gorder, Robert Blasi,
Richard Bain, and Lauren Arens. Nisan alleged he was issued letters of temporary
conservatorship from the court in San Diego and was suing in that capacity as well as in
his capacities as trustee and power of attorney. Nisan alleged Marvin suffers from a
neurodegenerative disease, most likely Alzheimer’s, and uncontrolled Type II diabetes.
Marvin’s illness has left him vulnerable to the respondents’ undue influence, resulting in
the dissipation of his assets.
       As to Tamara and Van Gorder, Nisan alleged they isolated Marvin from his family
by leading him to believe his family wanted to institutionalize him. Nisan also alleged
Tamara and Von Gorder, with whom Marvin lives, were not properly caring for him, as
they failed to provide him with necessary medication for his illness and his living area
was dirty and a fire hazard. Further, Nisan claims Tamara defrauded Marvin into
marrying her even though he lacked the capacity to marry. The petition alleged Tamara
diverted trust funds as well as non-trust funds into joint accounts which she accesses and
uses for her own benefit. Tamara has also allegedly incurred significant amounts of debt
using Marvin’s credit. Von Gorder allegedly drew down on Marvin’s long term care
insurance policies by falsely claiming to be his care provider.
       As to Bain, Blasi, and Arens, Nisan alleged they were attorneys who purportedly
represented Marvin in various actions, including a malpractice action against Marvin’s
doctor and in the conservatorship action. However, they breached their fiduciary duties
to him by taking property from him while he lacked the capacity to consent. It was
further alleged they worked to further the interests of Tamara and Van Gorder rather than
Marvin. Nisan sought an order requiring respondents to file an accounting with the court
covering the period from October 1, 2011, involving any trust or non-trust assets held by
Marvin. At the hearing on the petition, both Bain and Marvin’s guardian argued the
matter should be heard in San Diego. Nisan sought to recover funds paid to Bain for
legal services he provided to Marvin. Bain advised the probate court at the hearing on

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the petition that his fee dispute was currently pending before the court hearing the
conservatorship action.
       The probate court, after conferring with counsel and the guardian, found the issues
presented in the petition to be more properly adjudicated in the conservatorship action in
San Diego. We agree. It is clear Nisan’s petition for accounting exceeds the relief the
probate court may grant in this matter because Nisan seeks an accounting of both trust
and non-trust assets. Venue was proper in Los Angeles solely as to those issues relating
to the trust because Nisan, the trustee, resides and administers the trust in Los Angeles.
(§ 17005, subd. (a).)
       In a matter involving non-trust assets, however, venue lies in San Diego, where the
respondents reside. (§ 17005, subd. (c); Code Civ. Proc., § 395.) It is undisputed that
Marvin, Tamara, and Van Gorder live in Marvin’s home in San Diego. The record also
shows Blasi and Bain are residents of San Diego county and Arens lists her office in San
Diego. Nisan recognized the venue requirements when he filed the conservatorship
action in San Diego. Indeed, judicial economy would favor the accounting petition be
heard in the same court set to hear evidence regarding Marvin’s competency since there
are numerous overlapping issues. Nisan may not manufacture venue in Los Angeles by
mixing his accounting action involving trust assets with his non-trust dispute. In such a
mixed action case, where each cause of action is governed by a different venue provision,
venue must be proper as to all causes of action and all defendants. (Brown v. Super
Court (1984) 37 Cal.3d 477, 488.) All defendants reside or work in San Diego and the
petition for accounting should have been transferred there.6 (Ibid.) Dismissal was an
inappropriate remedy. (Code Civ. Proc., § 396, subd. (a) [“No appeal or petition filed in

6
        Arens filed a motion to transfer venue to San Diego on Marvin’s behalf early in
this action. That motion was denied. Respondents failed to renew the motion when
Nisan filed the petition for an accounting a year later. It would appear respondents have
waived their rights with respect to the issue of improper venue. (Barquis v. Merchants
Collection Assn. (1972) 7 Cal.3d 94, 121-122.) However, on appeal Nisan contends as an
alternative argument that the matter should be transferred to San Diego rather than
dismissed. Given the lack of a respondent’s brief and the correctness of Nisan’s position,
as discussed above, we exercise our discretion to transfer the matter.

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the superior court shall be dismissed solely because the appeal or petition was not filed in
the proper state court”].)
                                      DISPOSITION
       The order dismissing Nisan’s petition and complaint seeking an accounting is
reversed, with directions to the probate court to issue an order transferring the matter to
the court hearing the conservatorship action in San Diego County. The judgment is
otherwise affirmed. Appellant to bear his own costs on appeal.

                                                         BIGELOW, P.J.
We concur:

                     RUBIN, J.

                     FLIER, J.

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