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Hi, this is Stewart Albertson with Albertson & Davidson.  And I want to talk to you about an issue that we have seen come into our firm from time to time and that’s heirs coming in with a copy of their parents’ trust and they have the belief that they’re not able to contest that trust.

Let me give you an example:  Let’s say that mom and dad created a trust in 2010 and they split their estate between their three children equally.  It’s a three million dollar estate and so each one of their children is going to get one million dollars each.  But two weeks before mom and dad passed away in a car accident, one bad brother of the three children got mom and dad to change their trust with an amendment and in that amendment, everything goes to that bad brother and it excludes the other two children.  So now the two children that are out have lost a million dollars each and the bad brother is going to walk away with three million dollars.

The people that have been hurt and harmed in this case come and visit in our office and they’ve been told by other attorneys, they’ve been told by other family members, that you simply aren’t going to win this.  You can’t contest it.  You can’t challenge the amendment that your brother did.  And all that of that, I want to assure you, is false.  If you have been disinherited under the facts as I just presented them, you clearly have a right, a fundamental right, to bring a claim in the Probate Court and ask the Probate Court to look at this amendment, looks at the facts surrounding the creation of this amendment, and ask the Probate Court to invalidate that amendment and go back to the original trust, where your parents truly intended that each one of the siblings get one million dollars each.

So at the end of the day, to make sure we’re conveying to people that are having in this field with trusts and estates and amendments being made late or trusts being made late in a mom or dad’s life, you can contest them in the Probate Court.  Whether you win or not is a separate issue, but you certainly can contest them in a Probate Court.

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Hi, this is Keith Davidson with Albertson & Davidson.  And in this video, I’m talking about what the court has the power to do with a trust or will amendment.

So if you have a case where you have a trust amendment that you don’t like.  Maybe the trust was amended at the last minute disinheriting you.  A lot of times people who aren’t used to this area of the law will say, “Well, why can’t the court just toss out the last amendment?  Everybody knows it’s invalid.  Everybody knows my mom or dad wouldn’t have wanted to do that?  Why can’t the court just toss it out, rather than having to go through this big, long litigation process?”

It really comes down to what our legal system is based on – which is due process of law.  And what that means from a practical perspective is that both sides have to be given a fair opportunity to bring in their evidence to court, the court has to decide whether or not that evidence is admissible using the rules of evidence, the California Evidence Code, and then whatever evidence is actually admitted by the court, the court or the jury (depending on who’s making the decision) then gets to decide the facts of the case.  Who’s telling the truth?  Who’s lying?  Who’s winning?  Who’s losing?  That’s the process that you have to go through.

The court really doesn’t have the power to decide on a trust amendment without giving everybody a fair opportunity to be heard in court.  And that’s what we call a trial.  And, unfortunately, in our system, it can take some time to get to a trial, because everybody has to be also given a fair chance to do discovery, to go out and find the evidence that’s relevant to their case.

So typically, a case might take anywhere from ten months to eighteen months to go from start to trial.  It could take longer.  It depends on the type of case, it depends on the issues that arise, it depends on the court’s calendar, the lawyer’s calendar, the parties’ calendar.  It all just depends on the circumstances of your case.

But what cannot happen is the trust cannot simply be thrown out, the trust amendment cannot simply be thrown out by the judge just looking at it and saying, “I don’t like this.  I’m going to get rid of it.”  It has to be an evidentiary process that’s fair and equal to both sides of the case.

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Hi, this is Keith Davidson at Albertson & Davidson.  In this video, I want to talk about when is the right time to contest a will.  So a lot of times a will will actually be admitted to probate, as we call it, and then people will ask can I still challenge the will?  And the answer normally is no.

But you have to understand what probate even is to understand why the answer would be no.

So when people create a will, it’s not technically considered a valid will in the eyes of the law until somebody takes it to court and asks the court to take a look at it and to make a declaration, an order that it is a valid will.  And the way you do that is you file a Petition for Probate.  So you file your Petition with the court.  You say here’s the will, court.  We think it’s valid.  We want you to declare that yes, this is valid and open probate.  And when the court issues that order, saying the will is valid, that’s what we call admitting the will to probate.  And once the will is admitted to probate, then it can be administered under the will terms.

Well, the problem is that once the court admits the will to probate, it effectively is giving an order that yes, this will is valid.  So if you want to contest that will as being invalid, you have to do it before the court admits it to probate, before the court issues its order that yes, this will is valid.  Otherwise, you may have lost your right to do so.

Now, there is a separate section of the Probate Code that allows you to try to revoke a probate within 120 days of it being granted.  But that’s risky.  You, obviously, would rather contest the will before you ever get that court order saying it’s valid if you want to invalidate it.  That’s very important.

Now the flip side of this is, if nobody ever asks the court to validate a will, then really your time line to go and contest that will never starts to run.  And most people don’t try to admit a will to probate because most assets don’t pass under a will, they pass by trust, they pass by joint tenancy designation, they pass by insurance beneficiary designation; there’s all different ways that assets pass that don’t require a will.  And if that’s the case in your estate, then nobody’s going to submit the will to probate.  None of the assets are going to be governed under the will.  It really doesn’t matter if the will is valid or invalid, because it’s not going to do anything.

But if you have an estate where a will is going to govern the distribution of assets, the transfer of assets from the decedent to a child or somebody else, then it does become important to contest that will if you disagree with its validity prior to that will being admitted to probate.

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Hi, this is Stewart Albertson with Albertson & Davidson.  And I want to talk to you about a problem that we do see from time to time in trust and will cases and it’s a hard one to solve.  And that has to do where your mom or dad give all of their assets to one sibling and simply tell that sibling, “Hey, make sure you give everything in equal shares to your other – your sister and brother.”

What we find is that the sibling that gets all those assets from mom and dad, they’ll tell mom and dad, “Oh, sure, I’ll make the distribution equally.”  But then, when mom and dad aren’t there any longer and have passed away, that sibling has a change of heart and chooses not to distribute the assets evenly between the siblings.

These are tough cases.  You can file a petition with the probate court.  And under the totality of the facts and circumstances, witness testimony, hopefully some documentary evidence that your parents wanted to treat you all equally, you might be able to resolve the matter.

The better way for this to happen is for you to see this video before you mom and dad pass away and if you hear your mom and dad saying, “Hey, I’m just going to give everything to this sibling and they’re going to give it out to everybody,” that’s really not a good way to do it.  It’s not fair to that sibling to put them in that type of pressure situation anyway, because they’re going to be tempted to keep all the assets.  You’d be much better to have a valid will or a valid trust, or perhaps both, that shows how the distribution is to go at the date of death.  That’s much better than spending a year and a half or two of litigation trying to determine if, in fact, the one sibling that did get everything, if they were supposed to share that with all the siblings.

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Hi, this is Stewart Albertson with Albertson & Davidson.  And I want to talk to you about attorneys’ fees versus costs of a case.  So there’s a distinction.  You’ll generally get an engagement letter from a lawyer saying hey, you’re going to hire me to go in and contest a trust or a will, or whatever it is that you’re wanting to do.  Maybe perhaps you’re brining a financial elder abuse claim.  And you’re going to get this engagement letter.  And part of that engagement letter is going to have some terms in it that say you’re responsible for the attorney’s fees and costs if you’re hiring a lawyer on an hourly basis.  Or, if you’re hiring a lawyer on a contingent fee basis, they will describe the attorney’s fees that will front in the case but that what they will want reimbursed at the end of the case.

So if I haven’t totally confused you at this point, yet, let’s just talk about those two components.  Attorney’s fees and costs.  Attorney’s fees are what the attorney’s fees are.  If you hire a lawyer at $300.00 an hour, those are the attorney’s fees on an hourly basis going forward.  If your lawyer spends two hours on a project, it will be $600.00 in attorney’s fees.

Whereas if you hire your attorney on a contingency fee basis for 40% of the recovery of whatever it is they recover on your behalf.  Let’s say they recover $100,000.00 for you under that contingency fee agreement.  And it’s a 40% attorney’s fee.  They would then – you do the math – 40%, 40% of a $100,000.00 would be $40,000.00 in attorney’s fees that would go to the lawyer and you would receive the remaining $60,000.00.

Ok, so we understand attorney’s fees.  What are these costs?  Are they in addition to attorney’s fees?  Yes.  The cost of the case are how much it costs from a specific standpoint, from an invoice standpoint to bring the case forward.  If you do photocopies, let’s say it’s ten cents a page.  That’s a cost.  If you hire somebody to do your court reporting for you for depositions.  That’s a cost.  If you file the case with the civil court or the probate court and there’s a $450.00 or $500.00 filing fee.  That’s a cost.  And so that’s the distinction between attorney’s fees and costs.  Costs are the hard costs to run the case that are everything but attorney’s fees.  And attorney’s fees, that’s what you agree to pay either on an hourly basis or on a contingency fee basis.

And that’s how attorney’s fees and costs work.

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Hi, this is Stewart Albertson with Albertson & Davidson.  And we use this term abused trust beneficiary and we want to talk about what is an abuse trust beneficiary?  We generally see two types of abused trust beneficiaries in our practice.  We have those that we call vested trust beneficiaries and non-vested trust beneficiaries.

So let’s talk about the vested type first.  In this case, a beneficiary of a trust has a right to say one million dollar from a trust and it’s in the trust document.  Nobody disagrees that they have the right to that one million dollars.  But, for whatever reason, the trustee refuses to make the distribution of the one million dollars to the beneficiary.  Perhaps the trustee doesn’t believe the beneficiary will make wise choices with the money that is theirs under the trust.  Or maybe the trustee wants to use that money for themselves as they go forward in the trust administration.  Or maybe the trustee just wants to be in the power position and give a sibling of theirs a hard time that they had bad feelings for.

There’s many reasons why a trustee refuses to make distributions, but ultimately, if a beneficiary has a right to those distributions and they’re not being made, that is an abused trust beneficiary.  That is somebody who has a right to money and someone else saying “No, I’m not going to give it to you and I have no legal right to stand on in not giving it to you.  I’m just refusing to give it to you.”

In that case, you generally will have to get a lawyer involved.  The lawyer will ask the trustee to make the distribution on your behalf.  If the trustee refuses, unfortunately, you will have to file in the probate court and get the court to order a distribution of those assets.

So that’s the first type of abused trust beneficiary.  The second type of abused trust beneficiary has to do with a non-bested beneficiary.  This is someone who is/was a beneficiary of the trust in the past, but just before decedent passed away, someone comes along and gets that beneficiary taken out of the trust.

So same hypothetical.  In 2015, a mom says I’m going to give my three million trust estate to my three children in equal shares.  Meaning one of those children each get one million dollars each.  In that case, if one of those beneficiaries is written out of the trust two weeks before mom dies, and their million dollars disappears under the new amendment to the trust.  That is an abused trust beneficiary.  If mom didn’t intend that, if exercise of undue influence was taken over mom in order to get her to do that, then that trust beneficiary will have to, more than likely, file a petition to invalidate the amendment that was created that removed them from them trust.

So those are generally the two categories of abused trust beneficiaries that we see in California.  If you think you fall under one of these categories, more than likely, you’re going to need a lawyer’s help to understand your rights.  And then, once you understand those rights, decide on how you want to move forward to protect the interest that you may have in a trust.

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Hi, this is Keith Davidson from Albertson & Davidson.  In this video, I want to discuss the difference between trust principal and trust income.  So everything that goes into a trust, all the property, all the assets, all the money that go into a trust.  It gets broken down into one of two categories, it’s either principal, which is the property that the trust starts with or receives.  And then there’s income and that’s the amount of money and other things that the asset principal generates.  So if you have a stock, for example, the stock would be principal and if that stock pays a dividend, then the dividend payment would be income.  Same thing for rental property.  So if you have an apartment building or a rental home, the home itself, the building itself would be principal, but the rents that come in off that property, that would be income.

There are times when it can get a little tricky.  For example, if you sell a stock and you trigger a capital gain, that gain amount is actually principal, not income – even though it is subject to income tax as a capital gain, it’s still not income in the eyes of trust.  It’s actually a principal receipt.

So that’s kind of the difference between principal and income.

And it’s important to understand these differences, because different people might have different rights to principal versus income.  So, for example, it’s fairly common in a trust that’s set up for a surviving spouse where the surviving spouse might be entitled to all of the income.  So all the income goes to the spouse, but the principal either doesn’t get distributed at all or if it is distributed, it’s based on a standard.  Like the spouse can use it for health, education, maintenance or suppose.

So the two different types of property are going to be distributed out of the trust, based on different stands.  So you have to understand what is principal and what is income so that you know what property is the beneficiary entitled to and what property is more limited or discretionary in the eyes of the trustee.

You can also have beneficiaries that have an income only interest and other beneficiaries that have a principal only interest.  So sometimes they’re actually separated out based on income beneficiaries and principal beneficiaries.  Two separate groups of people.  And so obviously there you also want to know what is income so you can pay the right amount out to the income beneficiaries versus the principal beneficiaries.

So it’s very important to understand these distinctions.  It’s important to be able to categorize the principal and income appropriately.  And then, obviously, you want to distribute it appropriately.  And that’s a little something about trust principal and income.

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Hi, this is Keith Davidson from Albertson & Davidson.  In this video, I’m discussing the type of evidence you need to successfully have a trust or will contest granted by the court.

A lot of times, the first thing that a client will say to us when we first speak with them is “My mother never would have done this.” Or “My father never would have done this.” Or “My grandmother would have never done this and everybody knows that.”  And why isn’t that enough to get the trust or will thrown out of court?  And the answer is because our trust and will laws require more evidence than just that.  So if you were to say, “Well, my mom never would have disinherited me, so when she did this will a week before her death, it must be invalid, because she never would have done that.”  That, in and of itself isn’t evidence.

That is certainly your opinion and it may even be a correct opinion and it may even be backed up by other people who agree with your opinion.  But what the court needs in order to rule – to overturn a trust or a will, is evidence – admissible evidence that can be presented in court.  And you have to have grounds for overturning a document, meaning there has to be either lack of capacity or undue influence or fraud – there has to be some legal basis for it.  The fact that you don’t like the will or the fact that you don’t think your mother would have ever disinherited you, that, in and of itself is not a legal basis to set aside a will.

So, for example, with capacity, you have to show for a will that the testator did not understand the nature of their property, they didn’t understand the nature of their relations, their kids and grandkids, and they generally did not understand that they were signing a will.  Those are the three legal elements you must have.  And you notice that none of those elements have anything to do with whether or not mom would have ever disinherited you.  Yes, we’re trying to get to her intent – that’s true.  But, we’re also trying to show that she didn’t have the capacity to express that intent because of a lack of capacity and that takes evidence, not just an opinion.

The same is true for undue influence.  There’s elements for undue influence.  You have to show the victim was susceptible to undue influence because they had a mental condition that caused them to be susceptible to undue influence.  You have to show that somebody acted badly.  They isolated the person.  They manipulated them.  They controlled the necessities of living.  These are the type of things that you must prove in court.  None of those really have anything to do with the fact that your mom would have never done this, your grandmother never would have done this.

So it is, obviously, a very natural inclination, I think, for most people to say “My mom would never would have disinherited me.  Can’t we just get the will tossed out?”  Well, we might be able to get the will tossed out, but it’s not going to be because of that type of evidence, or those type of opinions.  It’s going to be because we can go out and find good solid evidence that is admissible in court in order to prove that that will or trust should be overturned.

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Hi, this is Stewart Albertson with Albertson & Davidson and I want to talk to you about an issue that we are seeing more and more of and that has to do with statutes of limitation.  Statute of limitations being the time period that you’re allowed to bring a lawsuit, whether it’s in probate court or civil court.

What we’re seeing is, and this video may be more to the practicing attorneys out there, but it’s also something the beneficiaries will want to be aware of.  We’re seeing people miss these statute of limitations in trust and will cases and we believe the reason for that is is because it’s a complex analysis to determine what particular statute of limitation applies at what particular time at what particular proceeding in a trust and will contest matter.

Let me give you an example from another area of law to show you why we’re having issues with the trust and estates statutes and we’re seeing those come up more often where people are making mistakes.

Let’s talk about personal injury.  Personal injury is very simple.  If somebody crashes into you in a car.  If somebody punches you in the face, you have two years to bring a lawsuit against that person before the statute of limitation runs.  In other words, you can do anything you want for up to two years, as long as you file your lawsuit before the end of two years.  You can bring a personal injury action against the person who hurt you.

Well, let’s come back to trust and estate law now.  It’s not that simple.  There’s various statute of limits that apply at different times.  Let’s talk about the bright line statute of limitations pertaining to decedents.  The general rule is that when someone dies, and everyone should know when someone dies, that’s pretty easy to ascertain.  You have one year to make a claim against that person.  But that year can be shortened to as little as 120 days, depending on the circumstances.

If a petition for probate goes out and you have a will that’s admitted into probate.  Once that’s admitted into probate, now you have 120 days to file a claim against the decedent.  To make matters worse, if you’re doing a certain type of claim against the decedent, you’re going to have what we call a creditor’s claim in the probate estate of the decedent and you’re going to have to file a lawsuit all before the end of the claim period running.

In other types of cases, you only have to file the creditor’s claim, but you can file the lawsuit after a year.  And so this becomes confusing to many lawyers as it may be to you now as I’m trying to explain it.

There’s also another complication where you have financial elder abuse claims.  This is where someone has a done a wrongful taking against somebody that’s a dependent adult or somebody that’s older than 65 years of age in California. We don’t want people abusing our elders.  We don’t want them taking their finances in a wrongful taking.  So the statute allows us to sue somebody, the wrongdoer in that case, for up to four years after the wrongful taking.  So we literally can have four years going by, and as long as we get the financial elder abuse case on file before the four years runs, chances are we beat that statute of limitations.  However, if you were given statutory notice under a trust, which gives you 120 days within which to file a trust contest, and you do not file that trust contest within 120 days, you may be precluded from filing a financial elder abuse claim even though it gives you four years.

One more thing to add and that would be what if the drafting attorney, the attorney that drafts the trust or will, what if they have made a mistake and they hurt you as an intended beneficiary of that estate plan.  In that case, you have one year from date of notice that you knew you were harmed by the attorney’s drafting, to file a legal malpractice case against that attorney.  If you don’t have notice and you discover it later, more than one year after the event took place, you may be able to argue you didn’t have actual knowledge or that you shouldn’t have known about the harm that took place, and you may be able to use a four year statute of limitations to sue the attorney for legal malpractice.

The whole point of this video is not for you to understand all of these varied statute of limitations, some as short as 120 days, some as a long as a year, some as long as four years, is to show you that there’s complexity in each one of these trust and estate cases, you need to have expert analysis of your case so that somebody can see what the facts and circumstances are and what statute of limitations are going to apply to your case moving forward.

If you miss a statute, chances are you’re going to be barred forever from bringing your claim forward.  So even those these are complex, difficult to understand, it’s something at the very beginning of a case you have to spend the time to understand, make sure you’re not missing anything, especially on the shorter ones such as the 120 days, because that one comes and goes very quickly.

Hopefully I haven’t confused you too much.  I’ve confused myself a little bit in going over all this.  All I want to point out is, this is a complex area, these statute of limitations in trust and estate matters, make sure you get somebody that’s qualified to explain them to you and you understand the time limits you have to bring your claim forward in either probate court or civil court.

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Hi, this is Keith Davidson at Albertson & Davidson.  In this video, we’re discussing trustee surcharge.  How do you hold your trustee liable for the damages that they have caused to your trust estate?

The number one way that you hold a trustee liable is you have to go to court on a petition asking the court to order the trustee to pay damages back to the trust.  That’s what we call a surcharge.  And you’re allowed to ask for a surcharge for any harms and losses that the trustee has caused to your trust estate.

You usually start by filing a petition with the court asking the court to order a surcharge against the trustee.  But you have to know what it is want to surcharge.  So if you know that the trustee has caused damage by taking a specific act, and you know how much the damage the trustee has caused, then you can go straight forward, file your petition and ask the court to order the trustee to pay that back.

If, however, you’re unclear as to the damage that the trustee did, then you’re going to have to do a little bit more than that.  And that comes in a couple of different way.  One way is you could file a petition asking the court to order the trustee to account.  So then the trustee has to do a formal trust accounting.  And that essentially will become your roadmap for whatever the trustee surcharges will be.  Because in that accounting, you should be able to see where the problems arose.

Also, using that accounting, you can start doing discovery, issuing subpoenas, getting bank records, getting financial statements, getting records from escrow companies.  And you can start piecing together the information yourself and finding out where the damage occurred to your trust.  Once you have that information, then you can ask the court to order the surcharge.

So it really depends on what information you have heading into the case.  The more information you have, the more likely you are to go straight into the petition asking for a surcharge.  The less information you have, you’re going to have to take the first step of becoming informed and then you can sue the trustee for surcharge.