Court Opinion

ID: 4702191
Source: CourtListenerOpinion
Date Created: 2021-07-08 18:03:25.116102+00
Date Added: 2024-06-11T08:06:22.640451
License: Public Domain

Filed 7/8/21 Bishop v. Hayon CA2/5

   NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                         SECOND APPELLATE DISTRICT

                                        DIVISION FIVE

 ALYSA MACKENZIE BISHOP,                                           B302751

           Petitioner and Respondent,                              (Los Angeles County
                                                                   Super. Ct. No. 18STPB06791)
           v.

 ESTHER PELED HAYON, et. al.,

           Appellants.

         APPEAL from an order of the Superior Court of Los
Angeles County, Clifford Klein, Judge. Affirmed.
         Benedon & Serlin, Gerald M. Serlin and Melinda W.
Ebelhar, Appellants.
         Holland & Knight, Vivian L. Thoreen, Roger B. Coven and
Vivian M. Rivera for Petitioner and Respondent.

                              __________________________
       This case arises from a family trust. Although a number of
issues were disputed by the parties, this appeal is limited to one:
whether certain properties that at one time were placed in trust
remained in the trust at the time the second trustor died. This,
in turn, requires consideration of whether, after the death of the
first trustor, the second trustor partially revoked the trust (to the
extent the trust was then revocable). The trial court concluded
the trust was not revoked and the properties therefore remained
in the trust. We agree and affirm.
        FACTUAL AND PROCEDURAL BACKGROUND
1.     The Trust is Executed
       The trust at issue is the Albert R. MacKenzie and Cynthia
J. Steinberg Revocable Trust, executed by spouses MacKenzie
(Husband) and Steinberg (Wife). They entered into the trust on
February 25, 2013, identifying themselves as the original
trustees. They attached a schedule of assets which they conveyed
into the trust. The schedule contained broad language indicating
the trustors transferred into the trust (subject to some
inapplicable exceptions) “all . . . property, whether real or
personal, tangible or intangible, that they own now or acquire
later during their lifetimes . . . .” We are not concerned with the
interpretation of that clause. The parties transferred to the trust
several identified real property assets, “whether community
property or separate property or otherwise,” including their
family home and two properties in Idaho. It is those specifically-
scheduled properties which are in dispute.
2.     Husband Dies; Wife Fails to Divide the Trust into
       Subtrusts
       Husband died November 1, 2013. According to the terms of
the trust, when one spouse died, the surviving trustor, who was

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also the trustee, would divide the trust into two shares which
would then fund subtrusts. The Survivor’s share would fund the
Survivor’s Trust, which the surviving settlor could “amend,
revoke, or terminate, in whole or in part.”1 The remaining
Nonmarital share would fund the Bypass Trust, which “shall
become irrevocable and shall not be subject to amendment after
the death of the deceased settlor.” In addition to the split into
subtrusts, upon Husband’s death, the trustee was directed to
distribute to Wife certain personal property, including household
effects, furniture, art, jewelry, antiques, and automobiles.
       Husband and Wife had no children together, but husband
had three adult children, one of whom, Alysa Bishop, was
identified as successor trustee. In the event Husband
predeceased Wife (as he did), Bishop was identified as the
residual beneficiary of the Bypass Trust, and the default
beneficiary of the Survivor’s Trust, if Wife failed to appoint any
other beneficiary.
       Upon Husband’s death in November 2013, Wife became the
sole trustee of the trust. Although the Trust required her, as the
sole trustee, to separate the assets into the Survivor’s Trust and
the Bypass Trust, she did not do so.

1      The Survivor’s share was defined as the survivor’s 1/2
interest in the community property, 1/2 interest in the deceased
settlor’s quasi-community property, and all of the survivor’s
separate and quasi-community property. That is, the division
between the subtrusts was not simply an equal division of the
trust assets, but turned on the separate or community nature of
each particular asset.

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3.     An Estate Planning Attorney Advises Wife of Her
       Obligations
       In October 2015, Wife went to see Attorney John
Kohlbrand (Attorney) who specialized in estate planning. She
wanted to discuss whether she would have to pay a particular
debt Husband had personally guaranteed. Either during or
following the meeting, Wife and Attorney discussed the trust and
Attorney learned that “she had not completed any of the steps
that [he] would have assumed the trust would call for at the time
of the first death.” When he asked her what steps she had taken,
Wife stated she did not know that anything had to be done.
Attorney asked her about the trust assets; Wife had no idea what
that meant and no idea whether assets were held in or out of the
trust.
       Wife talked about her “premarital” property and said she
wanted to maintain control over it, but had no knowledge
whether it was in or out of the trust. Attorney, who had not
reviewed the trust document at this point, told Wife that if she
wanted to control her premarital assets, the best way to do so
would be to create a separate property trust. Having not
reviewed the trust, Attorney could only speculate as to what he
expected to find within the document; he believed it would likely
include a requirement to divide the assets. He explained that
they would have to do a trust amendment to reflect the division.
Wife said there was an accountant who was working on the
division of assets.
       After the meeting, and after he had reviewed the trust
document, Attorney sent Wife a letter outlining issues “that must
be resolved” as a result of Husband’s death. It was a lengthy list
of “the legal steps which must be completed.” It included, among

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other things, the requirement to obtain a complete list of assets
comprising the estate at the time of Husband’s death, and the
date of death valuations of those assets (including real estate
appraisals). It specifically stated, “As a result of your Estate
Plan and to fully implement the terms intended by your Trust,
we must now complete an Amendment to the Trust to reflect that
you are taking the steps required, under the Trust, to carry out
the division of the Trust Assets which is called for to be made at
the time of the first death.” Attorney’s letter specifically
references the need to amend the trust to reflect the division of
assets into the Survivor’s Trust and the Bypass Trust.
      Wife did none of these things.
4.    Wife Executes a Will and a Trust Amendment
      Approximately one year later, on September 29, 2016, Wife
executed a trust amendment, naming her caretaker, Esther
Hayon, as the successor trustee in the place of Husband’s
daughter, Bishop. She also executed a will, which appointed
Hayon as executor and identified a number of beneficiaries,
including Hayon.2 The genesis of these documents is as follows:
      Eleven months after Wife’s first visit to Attorney, Wife
returned to Attorney’s office. Attorney believed that they would
be discussing the status of the items in his letter, but this was
not Wife’s purpose. Instead she told him she wanted to make
sure her “premarital” assets passed outside the trust. Attorney
discussed the possibility of a separate property trust, but noted

2     The other designated beneficiaries are Michael Vavrin,
Joyce Shaw, Curtis Shaw, and Henry Birnbaum. They are all
parties to this case. For our purposes, Hayon represents their
interests.

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that they needed to first determine “what is titled in the trust
and what isn’t.”
       Wife wanted to execute documents at that meeting that
would effect what she considered to be her separate property.
She seemed to be pressed for time and fidgety. Attorney would
later testify: “What I told her was that there were several things
that we needed to know to – to accomplish her objectives. And
among those were how were the titles held, and also that an
amendment might be necessary that we didn’t have time to deal
with or address that day she was there. [¶] Her comment was: I
want to sign something before I leave the office today. I want you
to do something. [¶] And at that point I did the – I draft, just
while she was sitting there, I put together that will, and I – I had
done – I had a previous draft of the amendment to the trust that
I had sent her, back in 2015, and I took that document and just
pulled out the part where she wanted her – deleted everything in
that document except the part that named Ms. Hayon as the
trustee. [¶] And so she signed both of those documents that day.
But I told her it was essential that she follow up, because we
needed to document further documents to make things absolutely
correct.” Wife took notes during the meeting and knew that she
had to come back to complete the process.
       Wife never returned. She died a few months later, on
December 7, 2016.
5.     The Dispute Arises
       After Wife died, Hayon took certain actions on the
assumption that certain properties had, in fact, been removed
from the trust and were part of wife’s estate, subject to her
control as executor. Litigation began on July 20, 2018, when
Bishop, Husband’s daughter, brought a petition against Hayon

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for, among other things, a determination that the properties
were, in fact, owned by the trust.3 (Prob. Code, § 850,
subd. (a)(3)(B).) She claimed Hayon had breached her fiduciary
duty as successor trustee and was liable for the wrongful taking
of trust property.
       Hayon responded to the petition and, as purported trustee
of the trust, petitioned the court for instructions as to how to
distribute the limited assets she believed remained in the trust.
She also claimed that Bishop’s petition violated a no contest
clause.
6.     Briefing on the Key Issue
       The trial court did not resolve all of the issues at once. On
August 21, 2019, the court indicated that it would hold a hearing
on the specific issue of whether the properties had been placed in,
and/or had been removed from, the trust. Hayon took the
position that the schedule to the trust had not been sufficient to
transfer the real properties to the trust; she argued that a change
in recorded title was required. She further argued that the trust
amendment and will executed by Wife on September 29, 2016,
were sufficient to divide the Trust into the two subtrusts and
direct distribution of the Survivor’s Trust to the will’s
beneficiaries. She argued that the will either modified the
Survivor’s Trust or revoked it entirely, thereby freeing those
assets for distribution via will. Bishop disagreed, arguing that

3      The operative petition is Bishop’s First Amended Petition.
In it, she asks that the court determine that the marital home,
the two properties in Idaho, two Merrill Lynch accounts “and any
other property or properties which are rightfully assets of the
Trust but have been treated as assets of the probate estate . . . be
determined by this Court to be assets of the Trust and subject to
disposition pursuant to the terms of the Trust.”

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the properties were indisputably transferred into the trust, and
that Wife never did anything to effectively transfer them out.
       On September 17, 2019, a hearing was held, and the court
took the issue under submission. The only witness to testify at
the hearing was the Attorney.
7.     The Court’s Orders and the Limited Scope of the
       Appeal
       The court issued two orders. On September 23, 2019, it
made an order on Hayon’s petition for instructions, but
specifically deferred ruling on the issue of whether the properties
were assets of the trust estate.
       Then, on October 1, 2019, the court ruled on the deferred
issue, concluding that the properties had been placed in the trust
and that the trust had not been revoked. The court found that
Wife had, in fact “wanted the disposition of her separate
property, whenever she could identify the parcels, to be
distributed outside of her trust to her heirs.” However, despite
having two meetings with Attorney, Wife “took no action after
either meeting to draft a revocation of any part of the trust
established by herself and her late husband.” Her trust
amendment modified the successor trustee but otherwise
expressly indicated the trust remained unchanged; her will
revoked prior wills but did not mention the trust. Therefore, the
trust was not revoked and the properties remained in the trust.
The court continued the matter for trial on the remaining issues.
Hayon filed a notice of appeal from only the October 1, 2019
order.

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                            DISCUSSION
1.      The Order is Appealable
        Bishop filed a motion to dismiss the appeal, arguing the
October 1, 2019 order was non-appealable. We deferred ruling on
the motion to dismiss and now deny it.4 An order made
appealable by the Probate Code is appealable. (Code Civ. Proc.,
§ 904.1, subd. (10).) Probate Code section 1300, subdivision (k)
states that an order adjudicating the merits of a claim made
under section 850 is appealable. Section 850, subdivision
(a)(3)(B) provides that a trustee or interested party may petition
the court for a ruling when the trustee has a claim to property,
“title to or possession of which is held by another.” The
October 1, 2019 order resolved Bishop’s claim, under that
subdivision, that the properties claimed by Hayon to be part of
wife’s estate were, in fact, trust property. The order is therefore
appealable. (Estate of Dayan (2016) 5 Cal.App.5th 29, 39; Estate
of Redfield (2011) 193 Cal.App.4th 1526, 1534.)
2.      The Properties Were Placed In the Trust
        In her brief on appeal, Hayon no longer pursues her
argument that the properties were not placed in the trust. The
implied concession is appropriate. The law is clear that, when a
trustor is also the trustee, trust language purporting to transfer
the property to the trust is sufficient to effect the transfer; a deed
transferring title is not necessary. (Estate of Heggstad (1993)
16 Cal.App.4th 943, 950.)

4     The motion to dismiss was filed before briefing. In her
respondent’s brief on appeal, Bishop changes position and argues
that the order is appealable.

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3.     The Trust Amendment and Will Cannot Be
       Interpreted to Transfer the Property or Revoke the
       Trust
       A.    Standard of Review
       We interpret written instruments de novo and review the
probate court’s resolution of disputed facts for substantial
evidence. (Estate of Dayan, supra, 5 Cal.App.5th at p. 36.) Our
review of whether property was transferred, on undisputed facts,
is de novo. (Carne v. Worthington (2016) 246 Cal.App.4th 548,
555-556.)
       “ ‘The basic rule in the interpretation and construction of
any will is that the intention of the testator must be carried out
as nearly as possible. [Citations.] In ascertaining the testator's
intent, courts employ an objective test: the intention to be
determined is that which is actually expressed in the language of
the will. [Citations.] “ ‘The intention which an interpretation of
a will seeks to ascertain is the testator’s intention as expressed in
the words of the will, not some undeclared intention which may
have been in his [or her] mind.’ [Citation.]” [Citation.]’ ”
(Schwan v. Permann (2018) 28 Cal.App.5th 678, 685.) We are
therefore not concerned with Wife’s intention in the abstract, but
with her intention as expressed in the documents she signed.
       Hayon posits the trust amendment separated the trust
assets into the Survivor’s Trust and Bypass Trust, and the Will
either impliedly removed the assets from the Survivor’s Trust or
revoked it entirely. We turn to those documents.
       B.    The Trust Amendment Did Not Divide the Trust Into
             Subtrusts
       We first turn to the language of the trust amendment
executed by Wife. The two-page amendment contains four

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provisions. The first acknowledged that Husband had died on
November 1, 2013, represented that the effective date of the
amendment was the date of his death, and stated, “The Trust
calls for certain events to occur upon the death of the first Settlor.
This Amendment implements the terms of the Trust that require
a division of the Trust Estate upon the death of the first Settlor.”
This provision is not mentioned again.
       The other three provisions of the trust amendment changed
the successor trustee from Bishop to Hayon, added a no contest
clause, and stated, “In all other respects the [trust] remains
unchanged.”
       Hayon argues that the language stating the amendment
“implements the terms of the Trust that require a division of the
Trust Estate” actually divided the trust into the two subtrusts.
But it did not. There was no attempt to actually divide the
assets, no mention of the Survivor’s Trust or Bypass Trust, and
no attached schedule of assets. Attorney testified that although
this language was present, he had advised Wife that more was
required to effect the division, and that she did not execute the
necessary documents. “ ‘The [drafting] attorney’s testimony,
although not conclusive, is entitled to much weight.’ [Citation.]”
(Wilkin v. Nelson (2020) 45 Cal.App.5th 802, 811.) Regardless of
wife’s desires, the trust amendment only changed the successor
trustee; it was a hollowed-out draft presented to wife for
execution because she demanded to sign something that day, but
the attorney explained to her that it was, in fact, insufficient to
put into effect her intent to distribute her separate property
outside of the trust.

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       C.     The Will Did Not Revoke the Survivor’s Trust
       Even if the trust amendment could be interpreted to divide
the trust into the two subtrusts, we would conclude that the will
Wife executed simultaneously with the trust amendment did not
revoke the Survivor’s Trust in whole or in part. The will contains
six terms:
       (1) a testamentary declaration revoking all previous wills
and codicils, but making no mention of trusts;
       (2) a clause representing Wife is not currently married and
has no children;
       (3) a clause giving effect to any “letter or other instructions
regarding the disposition of some or all of the personal property,
furniture, clothing, and jewelry,” and if no such letter exists,
indicating that property is part of the residue of the estate;
       (4) a gift of the residue to the identified beneficiaries and
noting Husband’s children are intentionally omitted;
       (5) a clause appointing Hayon executor and granting her
powers over the real and personal property of the estate; and
       (6) a no contest provision.
       None of these terms expressly removes any property from
the Survivor’s Trust or revokes the Survivor’s Trust. Relying on
Gardenhire v. Superior Court (2005) 127 Cal.App.4th 882
(Gardenhire), Hayon argues that the will impliedly revoked the
Survivor’s Trust. Gardenhire held that, when a trust allows
revocation by the trustor delivering a writing to the trustee – as
does the trust here – the trustor can make an effective revocation
in a will, when the trustor is also the trustee. (Gardenhire,
supra, 127 Cal.App.4th at p. 888.) The rationale is that, while a
will is largely a forward-looking testamentary document, it can
also have a non-testamentary element which can be given

                                 12
immediate effect. (Id. at pp. 891-892.) We agree with the rule in
Gardenhire: Wife had the legal ability to revoke the Survivor’s
Trust herself by giving notice of such revocation in her will. But
this does not resolve the issue of whether any language in her
will constituted such notice.
        The will did not expressly purport to revoke any trust at
all; it only mentioned the revocation of prior wills and codicils. In
Gardenhire, the revocation was made impliedly. The trustor’s
will mentioned her intent to dispose of all real and personal
property she had the right to dispose of by will and included
specific language providing that a certain beneficiary could live in
an apartment on an identified piece of property which the trustor
had previously placed in the trust. (Gardenhire, supra,
127 Cal.App.4th at pp. 885-886.) While the appellate opinion in
Gardenhire did not address the sufficiency of this evidence, we
infer that the Gardenhire trial court concluded that the trustor,
by making disposition of a property she had previously placed in
trust, intended by her will to revoke that trust. There is no
similar language in Wife’s will. She did not identify or purport to
direct disposition of any specific property previously placed in the
trust, sufficient to give rise to an intention to remove that
property or any property from the trust. She expressly
mentioned only “personal property, furniture, clothing, and
jewelry,” but all of that property was removed from the trust and
transferred to her outright upon Husband’s death. On appeal,
Hayon suggests that the will’s mention of real property in the
context of the executor’s powers to sell or lease “real or personal
property of my Estate” must have implied that she believed there
was real property in her estate and, further, that such real
property was comprised of the real properties previously in the

                                 13
Survivor’s Trust (which Hayon believes arose by the trust
amendment separating the trust into subtrusts).5 We are not
persuaded. The clause in question is no more than a general
reference to the executor’s powers; it neither identifies nor
disposes of any particular property.
       D.    Conclusion
       In sum, Hayon would interpret the trust amendment and
will to match wife’s intent to dispose of her “premarital” property
outside the trust. But we may not casually bend the language of
a will to meet the unexpressed desires of the testator. (Schwan v.
Permann, supra, 28 Cal.App.5th at p. 685.) As explained above,
we interpret the testator’s intention as expressed in the words of
the will. Here, the words of the will and the simultaneously
executed trust amendment did not separate the trust assets into
the necessary subtrusts and did not revoke the trust. Far from
revoking the trust, the trust amendment confirmed the trust,
stating, “In all other respects the [trust] remains unchanged.”
       Hayon argues that if the will mistakenly did not express
wife’s intentions, “it nevertheless should be interpreted in accord
with those intentions.” (Capitalization omitted.) We understand
this argument as invoking reformation of a will. In Estate of Duke
(2015) 61 Cal.4th 871, our Supreme Court concluded that wills
could, in fact, be reformed: “We conclude that the categorical bar
on reformation of wills is not justified, and we hold that an
unambiguous will may be reformed if clear and convincing
evidence establishes that the will contains a mistake in the

5     Similarly, she suggests that the will’s disposition of the
estate’s “residue” after having accounted for personal property
must imply that she believed there was real property in her
estate.

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expression of the testator’s intent at the time the will was drafted
and also establishes the testator’s actual specific intent at the
time the will was drafted.” (Id. at p. 875.)
       Reformation of a will involves the court’s equitable powers,
reviewed for abuse of discretion. (Wilkin v. Nelson, supra,
45 Cal.App.5th at pp. 809-810.) At the hearing, Hayon argued
that the will actually revoked the trust; she did not argue that
the will should be reformed to revoke the trust. In her opening
brief on appeal, she cited to authority regarding reformation in
the course of her argument that the will revoked the trust.
Bishop responded that reformation was not sought before the
trial court. In her reply brief, Hayon argues that reformation is
unnecessary because she can prevail simply by interpreting the
language of the will in light of Wife’s intent. However, she goes
on to argue that there is no hard and fast line between
interpretation and reformation; the two are instead part of a
continuum. But she never asked the court to exercise its
equitable discretion to reform the will, and does not suggest that
she did. We cannot review for abuse of discretion a decision the
trial court never made.
                          DISPOSITION
       The order is affirmed. Bishop shall recover her costs on
appeal.

                                           RUBIN, P. J.
WE CONCUR:

                        BAKER, J.                      KIM, J.

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