California Trust, Estate & Probate Litigation

Every party to a lawsuit would like to have their attorneys’ fees paid by the other side, especially if the other side loses.  That rarely happens in the U.S. because we have the “American System” of attorneys’ fees—that is each party pays their own.

There are a few exceptions, such as when parties enter into a contract that says the prevailing party is to be paid their attorneys fees.  There are a few other statutory exceptions, but overall Court’s are very reluctant to shift attorneys’ fees from one side to the other even where it is authorized by statute.

In cases that operate under the Probate Code (Trust cases, Will matters, and Conservatorships/Guardianships) there are a few areas where attorneys’ fees can be awarded, but rarely are.

Consider this: Trustees have a duty to render accountings at least annually.  Let’s say you’re a Trust beneficiary and after a year goes by the Trustee refuses to provide an accounting.  You send a written request to account and the Trustee either ignores you, or refuses to provide an accounting.  As a beneficiary, you have rights and you can assert those rights in Court, so you bring a petition in Probate Court asking the Court to order the Trustee to account.  The Trustee finally complies and provides you with a Trust accounting.  Can the Trustee be forced to pay your attorneys’ fees for the petition to compel an accounting?  No.  There is no provision that allows the Court to shift your fees to the Trustee. 

It would seem like this type of action should carry with it an AUTOMATIC requirement that the Trustee pay your fees—especially if the Trustee refused to account.  But it does not.

There are some instances when Courts are given the discretion to award attorneys’ fees, but they rarely do.  One of those instances is when either a Trustee fights an objection to his or her accounting “in bad faith” or a beneficiary brings objections to an accounting “in bad faith.”  The problem is that fighting an accounting is not enough, by itself, to trigger the shifting of attorneys’ fees from one party to another.  The fight must be done “in bad faith”—a higher standard and one that is difficult to meet in most cases. 

Plus, since Courts most often apply the American System of fee payment (each party pays its own way), Judges seem reluctant to shift attorneys’ fees even when they are authorized to do so.

What does this mean for you and your case?  Don’t count on getting your attorneys’ fees reimbursed.  I usually advise every client to go into litigation on the assumption you will NOT receive reimbursement for your attorneys’ fees and costs.  If you are one of the lucky ones who are awarded attorneys’ fees, then take it as an unexpected bonus.

Not fair you say?  I agree.  But it’s just the American way of pay to play in our Court system.

Want to know why beneficiaries lose Trust and Will cases?  They fall prey to the “greedy heir” defense.  The greedy heir defense goes like this: a beneficiary challenges the wrongful acts of a Trustee and the Trustee responds by saying the beneficiary is just greedy.  Or an heir who has been disinherited challenges a Trust or Will (or an amendment to a Trust and Will), and they are described as greedy.

Legally speaking, greed is not a proper defense to either a Trust accounting or a Trust or Will contest.  But these cases are heard and decided by Judges in California, and Judges are people too.  While Judges may be constrained by the law, they also have discretion to decide the facts of a case—who is right and who is wrong.  And it’s just human nature to want to decide against a “greedy” person. 

How do you counteract the greedy heir defense?  As a beneficiary or heir, you have to appear reasonable in what you are arguing and how you present your case in Court.  That means, at times, you can’t go after every little issue or every little argument.  You have to be strategic and decide what’s worth fighting over and (sometimes more importantly) what isn’t.  It’s not what’s important to you that matters, it’s the impact your arguments have on the Judge that counts.

For example, typically Trust and Will litigation involves various family members arguing over an estate.  They have a long history together and may have years’ worth of arguments, insults, and general bad acts that have built up over time.  Many times litigants want to focus on something the other side did many years ago because they think it shows some pattern of behavior or establishes that the other person is rotten.  But these past insults are rarely worth bringing into Court.  They take too much time to explain to the Judge and the Judge usually could care less about past disputes.  In litigation, you’re living in the here and now—so what you argue needs to be well crafted and to the point.  There may be one or two examples of past bad acts that are relevant, but probably not worth mentioning. 

Instead, a beneficiary or heir needs to focus on the relevant facts of the case.  If the Trustee has not properly managed the Trust, what did they do and why was it not proper?  That alone is enough to establish a breach of Trust and hold the Trustee liable.  The fact that the Trustee may have also been a jerk for many years is not so relevant.  This isn’t Family Feud, it’s trial.  Stay on task and be strategic about the arguments you make.  The more focused your arguments, the less "greedy" you appear in Court.

If you're going to do battle in Probate Court do you need to know more about Trusts and Wills or more about litigation?  The obvious answer is you need to know about both.  And while knowing about Trusts and Wills is critical, knowing a thing or two about civil litigation is also a must.

For example, under California Probate Code section 1000, the rules of civil procedure apply to actions filed in probate court (meaning all Trust, Will, and estate lawsuits).  This includes general civil procedure, civil discovery and the rules of evidence.

That sounds important, but what does it mean?  Let’s break it down into three general categories:

• Civil procedure—things like motions and demurrers
• Civil discovery—written discovery, depositions, and expert designations
• Rules of evidence—including foundation, hearsay, relevance, etc.

In this post, we’ll discuss the first category—civil procedure.  The next two posts will explore the use of civil discovery and the rules of evidence in probate court matters.

Civil Procedure.

While it’s true that the rules of civil procedure apply to probate court matters, there is an exception where a different rule is stated in the Probate Code.  For example, in a civil lawsuit the defendant has 30 days after being personally served with a complaint and summons to file an answer with the Court.  In Trust and Will matters, however, an interested party has the right to appear and object for the first time at the first hearing (see Probate Code section 1043).  And in civil lawsuits a complaint does not need to be “verified” (which means signed under penalty of perjury); whereas in probate court verification is required (see Probate Code section 1021).

Demurrers and Motions.

While some of the rules are different under the Probate Code, other rules are not. For example, demurrers.  A demurrer is a funny word to describe what essentially is a motion to determine if the Plaintiff (or “Petitioner” in the probate world) has stated enough in the initial petition to make a legal claim against the defendant (or “Respondent” in probate court).  Every lawsuit has some basic information that must be stated in order to continue with the suit.  When a suit fails to state the basics, the opposing party can ask the court to dismiss the suit.  The Court, if it agrees, will usually dismiss the suit with “leave to amend” meaning the lawsuit can be re-filed with the correct information stated.

A demurrer does not test the truthfulness of the claims made in the petition, it merely determines if the factual allegations are enough to form the basis of a claim.  Demurrers aren’t always that useful in litigation, but they serve a purpose in some cases and can be used in probate court where appropriate.

The same applies to other procedures such as Motions to Strike, Motions for Summary Judgment and Motions for Judgment on the Pleadings.  All are fair game in probate court matters, although their usefulness may or may not apply in probate. 

Motions for Summary Judgment.

Take motions for summary judgment (“MSJ”), they tend to be used a lot in civil actions.  An MSJ is designed to allow the Court to decide an issue, or sometimes an entire lawsuit, where there are no factual issues in dispute.  Most of the time, MSJ’s are not granted by the Court because there’s always at least some factual issue that must be decided in a lawsuit, which can only be resolved at trial before a judge or jury.  If two people are fighting over the existence of a contract, then the facts of whether a contract was created or not can only be decided at trial.  Whereas, if the contract creation is not in dispute (everyone agrees a contract exists), then interpretation of the contract terms may only involve legal issues—not factual determinations—allowing the Court to rule on a properly filed MSJ.

In most probate court actions, however, almost everything is a factual dispute.  For example, if a Trustee is being accused of mismanaging the Trust assets, that’s a factual dispute.  The Court must hold a trial and hear evidence to determine whether or not the Trustee acted appropriately.  For this reason, most of the time MSJ’s are not useful in probate court.  But they are available and can be used in the right situation.

The bottom line is that if you are going to battle in Probate Court you must arm yourself with knowledge of civil procedure if you hope to be victorious.

Beneficiaries have all the legal rights, and none of the legal obligations, when it comes to California Trusts and Wills.  But beneficiaries, at times, have one very practical obligation—paying to enforce their rights.

For beneficiaries of California Trusts, it’s every beneficiary for him or herself.  That means there is no governmental oversight of  Trustees until the matter is brought to Court.  And every Trust has the potential to wind up in Court if not managed properly.  But just because you may have the right to challenge a Trustee in court does not mean that it comes free of charge.

Most beneficiaries don’t know this, but our judicial system follows the “American Rule” when it comes to attorneys’ fees.  That means each party to a lawsuit pays his or her own fees and generally does NOT get them reimbursed even if successful in the lawsuit.  You read that right, you can win your lawsuit, but still be out the attonreys’ fees it took to get you there.  Seems unjust, and un-American (remember “justice for all”), but that’s the American Rule for attorneys’ fees. 

Contrast that with the English Rule (used in Great Britain and many other Countries) where the losing party to a lawsuit pays the winner’s attorneys’ fees and costs. 

There are a few exceptions to the American Rule even in our own judicial system.  For example, parties in a contract can agree that the winner gets his attorneys’ fees.  There are also a few statutes that only apply to very limited cases where fees can be shifted so the winner is compensated.  Such as with Trust accountings, where the losing party can be forced to pay the winner’s fees if the losers acted in “bad faith” (which can be a tricky standard to prove in court).

The problem is that California Courts are reluctant to shift fees even where doing so is authorized by statute.  In other words, the default rule that everyone pays their own fees, actually weighs against fee shifting even where authorized.  It’s just human nature, when everyone pays their own fees, why should the Court shift the burden of paying in a particular case?  And where the Court can exercise discretion and award fees to the winner, the Court typically will not do that because it goes against the norm. 

What does that mean to you, the Trust or Will beneficiary?  It means you have rights, but it may cost you to enforce those rights.  And you may as well assume that you will not be reimbursed for your attorneys’ fees. 

Given the American Rule, is it still worth enforcing your rights as a beneficiary?  Only you can decide that question.  It obviously is worth it to some people or else there wouldn’t be a backlog of Trust and Will cases congesting our Court system.  But before you go head-long into litigation, be sure to consider your own practical burden of being a beneficiary.  

Part Two: When do you fight, and when should you not fight, for your Right to Privacy? (See Part One here.)

In the words of Kenny Rogers, “you have to know when to hold ‘em, and know when to fold ‘em….”  Same is true for the Right to Privacy.  Just because the right exists and can be enforced doesn’t mean it should be enforced in every situation.

There is a strategy at work here that should be considered to determine whether disclosing private information is better for your case then trying to protect it.

First, let me acknowledge the fact that most parties to a lawsuit want to do everything possible to keep private information from the other side just out of principle.  I understand that.  Opposing parties tend not to like each other. 

But consider this: what if your private information tells a good story?  What if that information tells such a compelling story that any Judge or Jury seeing that information would side with you in your lawsuit?  That just might change your mind about disclosing private information. 

For example, so many times cases revolve around a joint account—money goes into the account and money comes out prior to the decedent’s death.  Was the money used for the benefit of the decedent or did the other joint account holder withdraw the money for his own benefit?  Allegations fly in each direction and the Court must decide who is right and who is wrong.

A joint account holder may be able to assert a right to privacy over the financial information contained in the joint account and could potentially hide that information from other parties.  But what if the bank information can establish that the money in the account was used exclusively for the decedent’s care?  Maybe the bank statements show payments to a care facility or nursing home, hospital bills and doctor bills being paid, prescriptions being filled, etc.  If this is the case, then the bank information tells a compelling story that even though money went into a joint account, it ultimately benefitted the decedent.

Keep in mind that if you refuse to disclose information under the right to privacy, and if that information is protected from disclosure by the Court, then you cannot use that same information at trial.  The law does not allow you to use your rights as both a shield and a sword.  If you refuse to disclose it, you can’t use it…period.

Under this example, waiving the right to privacy may be better for the case overall then trying to hide behind it.  Keeping good and valuable information under wraps can hurt your case because you then won’t be able to use that evidence at trial. 

This is just one example, there are hundreds of other scenarios where the information sought could be either helpful or hurtful to your case.  The point is to consider waiving the right to privacy at times.  Don’t just assert the right because it’s there.  Assert it when needed and let it go when its advantageous to you.

When you do decide to fight for your right to privacy, however, then fight as hard as you can.  So many times the right is waived unintentionally or because people think it won’t be upheld.  While you can’t guarantee that the Court will uphold your right to privacy, most Judges will give the right fair consideration, and will even protect the right to privacy in many cases.

What do you need to do to assert and protect your right to privacy?  That’s the subject of part three of this three part post.

Practice your Voir dire

                                 Motions for Summary Judgement

Will and Trust Litigation

It's not everyday that the California Court of Appeals hands down new law in the area of trusts and wills.  Most of our laws and rules in this area have been in place for centuries. 

This month, however, the Fourth Appellate District recognized a new claim for California beneficiaries called “Intentional Interference with Expected Inheritance” (referred to in acronym form as “IIEI”—if you want to be confusing).   The names sounds confusing, but the concept is fairly straightforward, albeit limited in its application.

Prior to this ruling, if a person thought they were going to inherit property from a decedent under a California Trust or Will, but they were cut out at the last minute, the only remedy would be in probate court. The disinherited person would have to sue to overturn the Trust or Will.  That works well enough if you are the type of person who has standing to bring such a lawsuit, but not everyone has that standing.

Where disinherited parties are related by blood to the decedent, such as children for example, then having standing to sue is relatively easy to establish because children oftentimes would receive an inheritance were it not for some intervening Will or Trust.  So if a child doesn’t like a Will or Trust, they can usually sue quite easily.  That does not mean the child will win, but a lawsuit can at least be filed and maintained.

Standing is not so easy to establish for those who are not related by blood to the decedent.  This includes friends, more distant relatives, and unmarried partners.  So what if you were going to receive an inheritance under a Will, but someone intervened and convinced the Decedent not to create the Will at all, thereby leaving assets to the Decedent’s family members instead?  Well you can’t sue in Probate Court because you wouldn’t have any standing.

But that has now changed with the Court’s decision in Beckwith v. Dahl.  Beckwith dealt with a decedent, his longtime unmarried partner, and the decedent’s sister.  The decent wanted to leave half of his estate to the partner and had even drafted his own will on the computer, but never printed the will out or signed it.  Shortly before going in to have lung surgery, the decedent asked his partner to draft a will leaving half his estate to the partner and half to his sister (meaning the decedent's sister).  The partner did as instructed, but called the sister before taking the new will to the hospital for decent to sign (big mistake).  Sister told him NOT to take the will to the hospital because she was going to call a lawyer friend of hers and have a trust created instead.  And since Trusts are so much better than Wills, it would be worth it to have a Trust instead of a Will.  Sister then has NEITHER a Trust nor a Will prepared.

Decedent then has surgery, incurs complications, and dies shortly afterward with no Will and no Trust.  Under California’s intestate laws, that means that the entire estate of Decedent passes to his next of kin—who just happened to be his sister.  The partner, of course, objects to this result because he knew what the Decedent wanted.  But partner is not married to Decedent, was not a registered domestic partner of Decedent, and is not a blood-relative of Decedent.  So partner has no standing to even file a lawsuit in Probate Court against sister to challenge the lack of a Will.

So instead of bringing a lawsuit in Probate Court, he sues sister directly in civil court under the doctrine of IIEI--a concept, as yet, unrecognized in California.

IIEI, as a concept, simply means that you are suing someone (here it’s the sister) for her wrongful actions in interfering with an expected inheritance.  In other words, if it had not been for sisters intervention, the Will would have been created and partner would have received half of  Decedent’s estate.  The Court actually articulates five (5) distinct elements to this claim, which includes:

1.         An reasonable expectation of receiving an inheritance,

2.         Some intentional interference with that expectancy by a third party (the wrongdoer),

3.         the interfering act was independently wrongful or tortious (the wrongdoer’s actions must have been a bad thing such as fraud, or undue influence),

4.         there was a reasonable certainty that but for the interference, the plaintiff would have received the inheritance, and

5.         damages (some loss of economic value).

But here’s the catch—and it’s a BIG catch—it only applies to parties who cannot bring a Trust or Will contest (or some other type of claim) in Probate Court.  In other words, parties have to exhaust all possible remedies in Probate Court first.  That means there are a vast majority of cases, where family members are contesting Trusts and Wills, that cannot use this IIEI concept. 

In Beckwith, the Court ultimately decides that while California law now recognizes the claim of IIEI, it does not apply to partner because the actions of sister (telling him not to complete the Will) were directed a partner and NOT at the decedent.  In other words, the wrongful act must have been done as against the Decedent.  Partner does have a claim for fraud, however, and can sue sister on the basis that she lied to him about creating the Trust for Decedent. 

The bottom line: it never hurts to know about IIEI, but it will not apply in very many cases.  While it would be nice to be able to sue opposing beneficiaries directly in civil court, it’s not going to work too often.

But still, a little new Trust and Will law now and then makes this practice area exciting—relatively speaking of course.

There are times when people try to implement an estate plan, but things go awry.  And that can happen when an attorney makes a mistake in drafting a California Trust or Will resulting in legal malpractice.

Bringing and prosecuting a legal malpractice case against an attorney who improperly drafted a California Living Trust or Will is complex, to say the least. It is particularly difficult because knowledge of three distinct areas of law is required for a hopefully successful outcome. First, you need to understand the law as it applies to estate planning (i.e. Living Trusts, Wills, etc.); you also need to understand the rules of civil litigation; and finally, you need to understand the rules and laws as they apply to insurance and bad faith insurance litigation.

Estate Planning: It takes years of experience to become a good estate planning attorney. Over the years, Trusts and Wills have become more complex due to multiple asset classes owned by individuals, married couples with children from previous marriages, and ever changing Trust, Will and Tax laws. Competition between attorneys that provide estate planning services is intense. What used to be only available from large and well-known law firms is now readily available across the spectrum of service providers--now large, medium, small, and solo law firms offer estate planning services. Even nonlawyers provide “assistance” in drafting estate plans. The costs for these estate plans range into the thousands of dollars to as low as $50 through several web-based providers. Unfortunately, with the intense competition between these providers, mistakes are made when attempting to convey the intent of the Trustors (the persons creating the Trust or Will) in the Living Trust or Will. This leads to beneficiaries being harmed if they do not receive the inheritance the Settlors intended. In all events, to successfully bring a successful malpractice claim in this area, one must have a good understanding of California estate plans, including Trusts and Wills.

Civil Litigation: Litigation is the process of filing a lawsuit, preparing for trial, and going to trial. The entire litigation process in California generally takes two to five years to complete. The majority of time in litigation is spent on discovery, which includes depositions, interrogatories, requests of admission, and demands to produce documents. Once discovery is completed the trial court will set a trial date. At trial a jury or a judge hears the case. The lawyers make opening statements, present evidence during direct and cross examination, and make a closing argument making their case why their client should prevail. The litigation process comes to a close with the jury or judge making a decision in favor of the plaintiff or defendant. One must not only understand the law as it relates to estate planning, but also civil litigation, to successfully prosecute a legal malpractice claim pertaining to California Trusts and Wills.

Insurance and Insurance Bad Faith Litigation: Most drafting attorneys have professional malpractice insurance, which covers the attorney up to a set amount for any lawsuit filed against them for legal malpractice. For example, if an attorney has an insurance policy of $1,000,000, then the insurance company who issued that insurance policy to the attorney will pay up to $1,000,000 for a successful litigation claim made against the attorney for legal malpractice. This is where an attorney bringing the legal malpractice lawsuit can do a lot for their beneficiary clients.

The goal is to force the insurance company to settle the lawsuit early on for the policy limits. If the goal is reached, the beneficiary obtains monetary damages for the loss they sustained by the drafting attorney’s malpractice without having to undergo the entire litigation process, which is time-consuming and extremely stressful. To implement the goal the attorney for the beneficiary simply needs to make a “reasonable” settlement offer (usually just inside policy limits) to the drafting attorney and the drafting attorney’s insurance company. If the insurance company refuses to pay the policy limit, it’s very likely the insurance company will be responsible for any judgment amount over the policy limit. This generally causes (and motivates) the insurance company to settle for policy limits.  Or if the company still refuses to settle, then it sets the stage for a bad-faith action against the insurance company down the road.  Either way, it’s a benefit to the beneficiary-plaintiff. Insurance and Insurance Bad Faith Litigation are perhaps the most misunderstood aspects of successfully bringing a legal malpractice lawsuit. You must know this area of the law.

Each of these three areas can be complex in their own right.  And in attorney malpractice cases in the California Trust and Will arena, you’ll need to combine knowledge of all three areas to be successful.

Feel free to call me if you have any questions about initiating and prosecuting a legal malpractice lawsuit against a drafting attorney. Also, if you would like the letter our firm sends to insurance companies for these types of cases, let me know.

At the end of every case—whether it’s settled or by way of judgment after a trial—I ask the opposing attorney to sit down with me to do a full review of the case. All issues in the case are open for discussion, except for attorney-client communications or any other privileged matters.

The purpose of the meeting is to become a better attorney by learning from the strategic missteps I made during the course of the litigation. When I say “missteps”, I don’t mean legal malpractice, I mean what strategic decisions I made that had little or no value, versus the strategic decisions I made that have better or greater value in the eyes of the opposing attorneys. Of course I encourage the opposing attorney to ask me the same questions about his/her strategic decisions—which ones I felt were good or not so good.

Less than a third of opposing attorneys agree to do this exercise with me. I’m not sure why it’s not 100 percent after some of the meetings I’ve done in the past. I’ve learned so much about what is effective in prosecuting my case and what isn’t. Additionally, I hear opposing counsel tell me his/her thoughts of the case as the litigation was unfolding. What stressors they had. What stressor they didn’t have. His/her view on settlement versus going to trial. And on and on…

I agree to keep the postmortem meeting with the opposing attorney confidential. And I trust they will return the same courtesy.

I challenge all California attorneys to offer to do a postmortem analysis of their cases with opposing counsel. We would all be better for it—learning and becoming better attorneys based on the analysis of our work from the impressions formed by the opposing attorney during the lawsuit and vice versa. And, doing this type of meeting would help foster better relationships between plaintiff and defense attorneys who may meet again in future cases.

The most important interrogatory in California is Form Interrogatory 15.1. Propound it; meet and confer on it; file motions to compel on it. Make them give you their facts, witnesses, and documents supporting their denials and affirmative defenses. Form Interrogatory 15.1 is the great equalizer in California trust and probate litigation.

We should never forget when reading a written decision by any Court that there are people—real, live, breathing people—behind the words laid down in the Court’s opinion.  I was recently reminded of this fact when I received a call from Tom Giraldin, son of William A. Giraldin, whose estate I discussed in an earlier blog post.

The Estate of William A. Giraldin has been the source of many year’s worth of litigation over various Trust issues (discuss in more detail in my previous article).  And in that previous article, I said that a son of William Giraldin, specifically Tim, was sued by “his siblings.”  Well I had that slightly wrong.  Tim was not sued by all of his siblings, but actually sued by four (namely, Patricia Gray, Christine Giraldin, Mike Giraldin and Philip Giraldin) of the Giraldin’s seven older children—my mistake.

But that’s not the interesting part.  The more interesting part is talking to Tom Giraldin and getting an inside look into the people and family relationships that underlie the Appellate Court’s opinion in Estate of Giraldin.  What type of person was William A. Giraldin (a strong business man), how did the facts come about (years of living), and did the Appellate Court get it right (yes, so says Tom)?

If you think about it, a lot of actions have to occur before a California Trust or Will case is heard and decided by the Appellate Court.  People have to live their lives, things have to happen in those lives, someone dies, people get upset and sue, the lawsuit takes over five (5) years to wind its way through the Courts, a party loses, decides to appeal, and then we get the Appellate Court opinion—coming at the end of what may be over a decade (or more) of actions in the making (both inside and outside of Court).  Whew!  Makes me tired just thinking about it.

But the lives lived and the things that occur during those lives are the substance of these cases.  And while the Appellate Court may provide us with a pretty cut-and-dry rendition of the facts, life is never so cut and dry.  And the way in which each party, each child, sees those facts is also very different—which is why the lawsuit is filed in the first place.

So the next time you read about the facts of a case in the Courts, in the newpaper, on the web, or in someone’s blog; its interesting to keep in mind that these are people we are reading about and they may have plenty of other facts behind the case that never come to light.

One of the hardest things to understand for people who do not have experience with our judicial system is the amount of time it takes to resolve most matters in court.  Why the wait?  In part, it’s due to the backlog of cases in most courtrooms and the lack of funding these days to hire the necessary amount of judges and other court staff to process these cases.

But there is also a built-in delay in California Trust, Will, Probate and Estate cases, a concept known as due process.  “Due process of law” is the term for how we must administer cases in our system of justice.  Due process requires a certain procedure to take place before a court makes a binding decision in your case.  In other words, the court cannot simply look at the documents that are initially filed by each side and make a snap decision.  This is true even where the facts seem pretty clear-cut and the law directs a certain action based on those facts; or even where the opposing party’s objections are baseless or frivolous.

Before any binding decision is made by the court, the court must first conduct a trial where each side is given a fair chance to bring whatever relevant evidence they have to substantiate their case.  Once the evidence (both documents and testimony) is presented at trial, then the court can weigh the evidence and make a decision.  Note that in California, nearly all Trust, Will, Probate and Estate cases are decided by a judge alone, as opposed to a jury as used in all other type of civil cases and all criminal cases.

A typical life-cycle of a Trust and Will case begins with the filing of an initial petition (Trust and Will matters usually use “petitions” as opposed to “complaints,” but they are the same in that each is an initial document that kick-starts the lawsuit).  Once that petition is filed, it is set for an initial hearing.  The initial hearing IS NOT a trial.  It is simply the first chance the court has to review the petition and determine if everything is ready to proceed—we call this “being at issue.”  If notice of the petition is not properly served or the petition is defective in some other respect, then the petition is not “at issue” and the initial hearing will be continued to give the petitioning party time to correct the defects. 

Each petition filed with the Court in California Trust and Will matters is reviewed by a probate examiner (which is either a lawyer or paralegal employed by the Court) to determine if the petition is properly prepared from a procedural standpoint.  They don’t test the validity or weight of the facts that are stated in the petition, they just make sure all the technical requirements are met for a properly filed petition.

Once the Petition is “at issue,” the opposing party has the right to show-up at the hearing and make a verbal objection to the petition (see California Probate Code Section 1043(b)).  Once made, the opposing party is given a certain amount of time in which to file written objections.  Once all objections have been filed, then the Court will determine how much time is required by the parties to conduct discovery—which includes issuing subpoenas, requesting documents and questions from opposing parties, and conducting depositions.  There may be disputes regarding discovery along the way, which must be sorted out with various motions to the Court.  Once the parties have completed discovery (or are close to it), then the Court will finally set a trial date. 

It is only at trial that the Court receives evidence and then weighs the evidence to make a binding decision in the case. 

As you can see the process, from start to finish, can easily take anywhere from 1 to 5 years depending on the issues encountered, the number of discovery and other fights along the way, and the amount of evidence that must be collected.  All in the name of “due process.” 

Death is final. And when a person who is a party to a lawsuit dies, death can be final for the opposing party too unless they take action quickly.

Dead people cannot be sued by law.  Therefore, any claims against a decedent (including those already in progress by way of an existing lawsuit) must be brought in the decedent's estate.  By estate, I am referring to a probate estate.  This is true even where a decedent died with everything he owns held in a Trust.  Why the probate estate?  Because that is where all claims against a decedent must start. 

And there are two very important deadlines you must remember when trying to preserve a claim against a decedent.  First, is the overall one-year statute of limitations under CCP 366.2.  This harsh rule states that any claims against a decedent must be brought within a year of the decedent's death or they are forever barred.  This is true even though the statute of limitations would have been longer had the person survived.  For example, the statute of limitations for breach of a written contract is 4 years, but if the breaching party dies, then the statute is cut down to a one year limit.  And this rule applies regardless of whether you knew the person died or not!

Second, if a decedent dies and his heirs/beneficiaries open a probate estate, then any creditor has only 4 months from the date an executor is officially appointed to file a claim in probate.

The lifecycle of a claim

When there is a claim against a decedent, or an ongoing lawsuit against a deceased defendant, the first step any creditor must take is to file a "Creditor's Claim" in the decedent's probate estate.

If a probate estate is not opened (and this happens often where the decedent died with a trust because no probate is necessary to transfer his assets), then the creditor must file to open a probate (creditors have the right to do this as interested parties of the decedent's estate).  Once the estate is opened, then the claim is filed with the estate.

The estate representative (i.e., the Executor of Administrator) then has to either accept the claim, and thereby agree to pay it, or reject the claim.  After 30 days the creditor can deem the claim rejected.  Once a claim is rejected, the creditor must then file a lawsuit against the estate to force the estate to pay the claim.  If a lawsuit is already pending against a dead defendant, then once the claim is rejected by his estate the estate representative must be substituted in as the party to the lawsuit.  The lawsuit can then continue. 

If a judgment is achieved as part of the lawsuit, then that judgment can be enforced against the estate.  If there are no assets in the estate, then the creditor can go after the decedent’s trust.

Sound confusing?  It is, and the procedural requirements are strictly enforced so any mistake along the way can be fatal to the creditor in attempting to collect a debt.  So beware, any death of a party to a lawsuit, or any death of a debtor, can be fatal to your claim too.

Trust and Will litigation is a bit of a shell game.  You remember the shell game, where a pea is placed under one of three shells and then the shells are re-sorted as quickly as possible so as to lose track of which shell has the pea.  The observer is then asked to pick the shell with the pea—it’s a 1 in 3 shot of getting it right.

The reason Trust and Will litigation is like a shell game is because so much depends on how assets are titled at death (see our earlier blog post on this issue).  The Trusts and Wills are the shells and the assets are the peas. 

For example, a decedent may die with a Trust, but if nothing is titled in the name of the Trust, then there may be nothing to contest regarding the Trust.

And a Will only controls what is in the estate, which means only those assets titled in the decedent’s name alone (this excludes property titled in joint tenancy, by beneficiary designation, or in the name of a trust).  However, in most cases, people have “pour-over” Wills that pass all assets from their estate to their Trust.  Thus, a Trust may not have any assets to begin with, but can obtain assets from a pour-over Will.

Sound confusing?  It is.  So where do you start when you want to contest a Trust and a Will (or is it a Trust or a Will, or just a Trust, or maybe just the Will…)?

Step One.  You have to determine where the assets are located.  Often, they are scattered all over the place, with some in a Trust, some in the decedent’s own name (so those are in the probate estate), and some passing by joint tenancy with right of survivorship (which pass outside the Will and the Trust). 

Step Two.  Once you have identified where the assets are located, you need to know what documents you are working with.  Is there a Trust, what does it say, and when was it last amended?  Is there a Will, what does it say?  What about joint tenancy property?

Step Three.  You have to decide what to attack first.  Typically that would be the vehicle that has the assets.  So if the assets are in the Trust, contest the Trust.  If the assets are in the probate estate, contest the Will.  (You'll have to open probate to contest a Will, if probate is not already opened.)  If the assets are in joint tenancy, you have to file that lawsuit in the probate estate (see Probate Code Section 5302), but it will take clear and convincing evidence to dislodge the joint tenancy.  Sometimes, you will want to attack all three at the same time if there is a chance that assets may pass from one vehicle to another (such as from a pour-over Will to a Trust).  Other times, you will attack just one and save the other contests for later if the need arises. 

The mistake you want to avoid is attacking a vehicle that has no assets and never will have any assets.  So if an asset is passing by joint tenancy (which passes outside a Will and a Trust) and you want to attack that transfer (i.e. the joint tenancy transfer, such as a jointly held bank account), then you have to file a lawsuit in the probate estate and request that the joint tenancy asset be returned to the estate.  If you are successful, then (and only then) the asset would pass by Will, if the Decedent had a Will, or by intestate succession if there is no Will.  You most likely do NOT want to contest the Decedent’s Trust in this scenario because the Trust does not own the joint tenancy asset.  In fact, the Trust has nothing to do with joint tenancy assets in most cases.

The bottom line is to map out the location of the assets and the documents you are contesting.  Of course, there has to be a reasonable legal basis for the contest and you have to watch out for any no-contest clauses (see our earlier posts on no-contest clauses).  But once the facts are mapped out, you can then plan your attack on the document that holds the asset(s). 

We have created various handouts for our clients to explain certain aspects of a lawsuit.  In an earlier blog post I shared our handout describing the overall process of a lawsuit.  We also have created handouts on what to expect at a deposition and what to expect in written discovery.  We have decided to make these forms available to you as well by posting them on our website.

Again, these are not meant to provide an exhaustive listing of everything that occurs during the litigation process, but it does provide some basic information so that people who are not familiar with the legal system will have some idea of what they can expect. 

My law partner is fond of saying that "A lawsuit is a marathon not a sprint."  I like his quote because it sets the expections of what a client can expect to incur during the course of a lawsuit.  It does not matter what type of suit it is, be it Trust, Will, Estate, Probate or Civil litigation, the general overview of what to expect is the same.

To give our clients a snapshot of the litigation process, we have prepared a memorandum of what  clients can expect during the course of their lawsuit (What to Expect In Your Lawsuit.pdf).    It does not answer every litigation question, but it provides a basic primer on the litigation process.  We've decided to share that same memorandum here on our blog so everyone can see our basic primer on what to expect in your lawsuit.

California Form Interrogatory 15.1 (an “interrogatory” is just a question) is the most important interrogatory to serve on your opposing party in a lawsuit. And the law requires they answer it fully and completely. Yet, so many attorneys refuse to answer the question properly.

A typical use of 15.1 follows:

You file a Trust Contest or a Will Contest (or any other type of lawsuit) alleging three causes of action: (1) Undue Influence, (2) Lack of Capacity, and (3) Financial Elder Abuse. The opposing party files an answer to the Trust Contest or Will Contest denying most, or all, of your allegations, and on top of that includes 15 affirmative defenses (an affirmative defense, if proven by the opposing party, operates to defeat your claims even if the facts supporting the claim are true).

The opposing party’s denials and affirmative defenses must ultimately be tried, which can make for a long, costly and confusing trial.  But what if the denials and affirmative defenses could be trimmed down before trial?  That’s the purpose of 15.1—you can narrow the issues, and force the opposing party to show their cards—factual cards—before trial. Once you narrow the issues in a case, you are able to clearly and forcefully present the true facts of the case at trial, which generally equals a win for you.

How does 15.1 do this? 15.1 requires the opposing party to provide all facts, all persons, and all documents that support (1) their denials, and (2) their affirmative defenses. In other words, for each denial of a material allegation in your lawsuit (i.e., Trust Contest or Will Contest) the opposing party must (1) identify all facts supporting each denial, (2) identify all witnesses (including their names, addresses, and phone numbers) who can testify about facts supporting each denial, and (3) identify all documents (or things) (including the name, address and phone number of the person who has each document) supporting each denial. Likewise, the opposing party must identify all facts, witnesses, and documents that support each and every affirmative defense (all 15 of them in the case presented above—that’s a lot of work).

To date, I have never received a proper response from an opposing party to 15.1. I generally follow up the opposing party’s response with a required “meet and confer” letter articulating how they must respond to 15.1. If the opposing party refuses to supplement their improper response I generally file a motion with the court requiring that they properly respond to 15.1. Any time I have filed a motion with the Court on 15.1, the Court has granted my motion and ordered the other side to respond. I have even received monetary sanctions against the opposing parties. So beware, when 15.1 comes your way, especially from my firm, it must be answered.

If you have questions, or would like to receive a form copy of my motion to compel for 15.1, please contact me.  

My law firm strongly believes in fighting for justice and fairness—so much so that we put it right on the first page of our website. But these two concepts, “justice” and “fairness”, are confusing at times, which makes it difficult for clients when attempting to understand how to obtain justice or fairness in a lawsuit. 

Let me first explain these two terms in my view. 

Justice:  Justice is the process of presenting evidence in Court before a judge or jury and having them decide in your favor after the evidence is reviewed. When you win in court you receive a public pronouncement that you are right and the other side is wrong, and you receive a just punishment or reward against the other side in the form of damages, i.e. usually money.

Fairness:  Fairness is a financial determination—w ill you receive more from the lawsuit financially than you put into it?  If you spend $20,000 on a lawsuit, you want to receive more than $20,000 out of that suit.  Otherwise, the lawsuit was not fair—meaning financially fair.

Justice pays no attention to the financial costs of a case.  If a person wants justice they must be willing to spend as much time, emotional capital and money as necessary to achieve that result, which can often be an unfair result from a financial viewpoint. And just because a case goes to trial does not mean that justice will be served;you could lose and thereby suffer an unjust result in the process. That’s one of the risks of fighting for justice—injustice.

For example, when we prosecute killers in court for capital murder, whichcarries the death penalty, it is very expensive.  The cost of trying death penalty cases far outweighs any financial gain we (society) will get back in return.  So do we decide not to prosecute murderers because it's just too expensive?  No, because we want justice and as a society we are willing to pay the price for justice.  Plus, it is society as a whole who pays--no one person is asked to pay for a death penalty trial.  But the death penalty trial is not fair from a financial standpoint because the financial costs outweigh the financial benefits—but it is just.

In a civil lawsuit, however, whether it be personal injury, breach of contract, will or trust contest, or breach of duty case, a single person or small group of people are paying the bill. And a vast majority of people want their case to be fair--meaning they will get more out of the case financially than what they put in.  Yet, people regularly want justice. 

But justice is not easy to obtain. Rarely is it handed out willingly. It must be fought for at any cost and there is no guarantee that a just cause will prevail--losing is always a possibility. It takes time, effort and an emotional toll to pursue justice. Nelson Mandella, Martin Luther King, Jr., our Founding Fathers all fought for justice, placing their lives and freedom on the line. They paid a high price for their just causes; it was not a fair result.

Sometimes, justice and fairness are both achieved such as when a personal injury suit is won with an appropriate award for damages (although one could argue that the damages should have been paid without having to pay an attorney a fee to go to trial—so maybe it’s not so fair after all). 

The next time you find yourself in a dispute ask whether you are fighting for justice or fairness.  If you really want justice, be prepared to pay the price.  And if you really want fairness, then take the opportunity to accept a fair result when and if one is presented.   

Listen to Keith A. Davidson summarize his blog post on the difference in contesting a California Trust and a California Will.

Which is better—A Trust or Will if a fight takes place for your assets after your death?   One of the primary reasons people create Living Trusts (also called Revocable Trusts and Revocable Living Trusts) is to avoid probate. And Trusts can also help in reducing or, in some cases, eliminating estate taxes. But can a Trust also help discourage a contest over an individual’s intended disposition of his or her assets at death?  The answer is a resounding “maybe.”  Let me explain.

Some people believe Trusts better protect against a contest because Trusts are not administered with court supervision. Once the person who created the Trust (referred to as the Settlor) dies, the Successor Trustee begins administering the assets, gathering them up and preparing these assets for distribution to the Trust’s beneficiaries (usually family members), without any need for court supervision. On the other hand, a California Will can only be administered in probate, which requires court supervision. In fact, an Executor is not even appointed to act under a Will until a Petition for Probate is filed with the court and the court appoints the person as executor. Once in court, anyone who wishes to challenge the Will has a ready forum in which to do so. In other words, a contestant normally does not need to open the court process pertaining to a Will—they merely need to show up and file an objection in the probate court.

In contrast, contesting (or challenging) the terms of a Trust is not quite so easy. Trusts can be challenged in court and trustees' actions can be challenged in court, but the person wishing to contest a trust, or its trustee, must take the initiative and bring the matter to court by filing an appropriate petition.  Thus, it is the contestant who has to take the initiative to start the court process when it comes to trusts—they can't just show up and object as in the probate of a California Will.

So back to the “which is better” question—is is a Trust better than a Will in warding off attacks by angry beneficiaries? It depends.  If an heir or beneficiary is set on contesting the document and if the heir has means to hire an attorney, then a Trust is just as vulnerable to attack as a Will—the fact that the heir or beneficiary must start the process will usually not prevent an attack. If, however, an heir or beneficiary does not have the means to hire an attorney and does not know how to bring a trust contest to the Court’s attention, then the trust may be better at preventing attack. A California Will, after all, is already filed in court, which allows a beneficiary to object to it much easier, sometimes without the help of a lawyer.

Therefore, a Trust may have some benefit over a California Will in preventing a contest by an angry heir or beneficiary, but the benefit is relatively small if the heir is ready, willing and able to take action to bring the matter to court.

Here are my top 10 books every trial attorney should read once a year:

1. Rules of the Road, Second Edition, by Rick Friedman & Patrick Malone

            This is likely the most influential book I’ve come across in my time as a lawyer. Read it, and then read it again. I use the “rules” concept in my depositions as well as at trial. It is amazing how effective the “Rules of the Road” approach works.

2. Reptile, by David Ball & Don C. Keenan

            I can’t figure out whether I like Reptile or Rules of the Road better. Both are the two most important books a trial attorney can read in my opinion. My suggestion is to read Rules of the Road first, then Reptile. Then Reptile first, and Rules of the Road Second. Did I say I like these two books?

3. David Ball on Damages, by David Ball (A Third Edition is scheduled for release in February 2011)

            A great book that attorneys wanting to do trials—and do them well—need to read. The voir dire chapter is worth the price alone.

4. Polarizing the Case, by Rick Friedman

            Is the defense calling your client a liar, cheat, and a fraud? You will thank the defense after reading this gem of a book. I come across this defense tactic in almost every case. This book teaches you how to embrace the defense’s accusations and make them look foolish. My favorite is, “Dr. Jones, when did my client start lying about her physical suffering?” I still haven’t heard a good answer from Dr. Jones to that question.

5. Rick Friedman on Becoming a Trial Lawyer, by Rick Friedman

            Perhaps I should have read this book first. My recommendation to all trial attorneys is to read this book. It will change the way you view your role as an attorney helping people who have been harmed by other peoples/entities’ irresponsible actions.

6. Cross-Examination: Science and Techniques, by Larry S. Pozner and Roger Dodd

            Want to know how to effectively cross-examine at deposition and trial? This is the only book you will ever need for that purpose.

7. Win Your Case, by Gerry Spence

            A very easy read with insightful advice from one of the best trial attorneys. You just feel good reading this book.

8. Recovering for Psychological Injuries, Third Edition, by William A. Barton

            I have not finished reading this book yet, but it is full of great ideas that you can use for all types of cases. You will need a copy of the Diagnostic and Statistical Manual of Mental Disorders (Fourth Edition) as well.

9. The Evidence Wheel, by Robert S. Arns

            This book is for California attorneys. I was always confused on evidence before I read The Evidence Wheel. Now I have quick trial reflexes to handle the introduction of evidence I need for my case, and how to keep the opponent’s evidence out. You can also get The Trial Wheel by Robert S. Arns, which is a companion to The Evidence Wheel. Both books help you to be quick on your feet at trail, and right most of the time.

10. All books by Bryan A. Garner. The book I like the most is “The Winning Brief”. You will become a better writer after reading, digesting and then implementing Mr. Garner’s advice. (Please do not hold anything against Mr. Garner for my current writing abilities, as they were much worse before reading his books.)

11. I know, I said the top 10 books, but I have to throw in one more book. Logic For Lawyers, by Ruggero J. Aldisert. A tough read, but it definitely sharpens your legal reasoning—and helps you find your opponent’s lack thereof. 

Walking into probate court for the first time can be a daunting experience. And not just for non-lawyers. Many lawyers who have spent their careers practicing in other areas can find the rules and procedures of probate confusing--that's if they find the rules at all. 

Walking into probate court for the first time can be a daunting experience. And not just for non-lawyers. Many lawyers who have spent their careers practicing in other areas can find the rules and procedures of probate confusing--that's if they find the rules at all. 

I have spent nearly my entire ten-year career in this area so I sometimes forget how difficult it can be to come into a complex area of the law unprepared for what awaits.  But I had a bit of a reminder recently--a wake-up call of sorts.  I went to Bankruptcy Court.  It wasn't my first time there, but it had been a while (five years or so).  Bankruptcy court is a lot like probate court in the sense that both require an understanding of a unique procedure and special rules that do not apply in general civil practice. 

As I sat in bankruptcy court waiting for the judge to take the bench, I heard the other lawyers around me speaking in code sections and terms that were entirely foreign to me.  Luckily I was in bankruptcy court for a minor reason--to set aside the automatic bankruptcy stay for a civil case my firm was handling where the defendant filed for bankruptcy protection.  I managed to obtain the relief I was seeking, but I realized that coming into this court, with its arcane rules and procedures is like going into probate court for the first time and not knowing that area of law.  Simply put, experience matters.

For example, in trust cases we often file multiple pleadings at the same time to protect our client's interests. Such as filing a creditor's claim in an estate, a petition to transfer property (called an “850 petition” in probe lingo) and a petition to contest a trust or will all at the same time in the same case.  These can be confusing filings when compared to a single complaint that is filed in a typical civil lawsuit.  But confusion is checked with experience, and it makes the difference between being protected and being vulnerable.  

I am going to leave Bankruptcy Court to the bankruptcy lawyers--they seem to have things well in control. And I will continue plying my trade in the confusing world of trusts and wills where my experience has taken me.