California Living Trust Form by goo62679


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									Filed 4/9/03



                        FIFTH APPELLATE DISTRICT

DONALD O. GERMINO, as Cotrustee,
etc., et al.,                                              F041268

    Plaintiffs and Respondents,                     (Super. Ct. No. 23107)


DARIUS P. HILLYER,                                      OPINION

    Defendant and Appellant.

        APPEAL from an order of the Superior Court of Merced County.
William T. Ivey, Judge.
        McCormick, Barstow, Sheppard, Wayte & Carruth, Todd W. Baxter; Dunn,
Swan & Cunningham and Sheldon B. Swan for Defendant and Appellant.
        Dowling, Aaron & Keeler, William J. Keeler, Jr., and Leigh W. Burnside
for Plaintiffs and Respondents.

*       Pursuant to California Rules of Court, rules 976(b) and 976.1, this opinion
is certified for publication with the exception of parts C, E and F of the

         This is an appeal from an order granting instructions to cotrustees; the order
is appealable pursuant to Probate Code section 1304, subdivision (a). (All further
statutory references are to the Probate Code unless otherwise specified.) We will
hold that the trustees‟ notice pursuant to section 16061.7 was adequate to
commence the limitations period established by section 16061.8. The trial court
was correct that this limitations period has expired; therefore we will affirm the
                            Facts and Procedural History
         Decedent Vincent L. Hillyer created a living trust, nominally funded during
his life but endowed by his pour-over will with a corpus of about $3 million upon
his death in 1999. The trust instrument contained a no-contest clause. In a prior
appeal (Hillyer v. Germino, F036004, filed June 18, 2001) we considered whether
a proposed petition by the present appellant, Darius P. Hillyer, would violate that
clause. (See § 21320.)1 We held that, in large part, the proposed petition would
violate the trust‟s broad no-contest clause.2
         Remittitur issued from this court and jurisdiction vested again in the trial
court on August 20, 2001.
         On February 26, 2002, respondents, the trustees of the Vincent Hillyer
trust, filed a petition for instructions requesting, as relevant here, a determination
whether the 120-day statute of limitations of section 16061.8 barred any further
challenges to the trust instrument by appellant. Appellant opposed the trustees‟

1      Section 21320, the so-called “safe harbor” provision, allows a potential
contestant of a trust instrument to obtain a judicial determination whether a
particular attack on the trust constitutes a violation of the particular no-contest
provision contained in the trust instrument. (See Genger v. Delsol (1997) 56
Cal.App.4th 1410, 1428-1429.)
2    We grant respondents‟ request for judicial notice of our opinion in

petition for instructions on the basis that the trustees‟ notice under section 16061.7
(which we will describe below) was insufficient to commence the limitations
       After a hearing on April 29, 2002, the court entered an order on July 2,
2002, concluding that the statute of limitations had expired as to any claims by
appellant contesting the trust to the extent those claims were subject to prior
determination under the safe harbor provisions of section 21320. (See fn. 1, ante.)
The court also ordered that any assertion by appellant of an oral agreement
between himself and decedent that superseded the bequest of decedent‟s estate to
the trust was a “possible exception” to the bar of the section 16061.8 statute of
limitations. Finally, and consistent with our earlier opinion, the trial court
concluded the statute of limitations found in section 16061.8 was inapplicable to
challenges to donative transfers to interested persons under section 21350.3
       Appellant filed a timely notice of appeal.
       A. The Probate Code
       Section 16061.7 provides, as relevant here, that a trustee shall notify the
beneficiaries of the trust when a revocable trust becomes irrevocable because of
the death of the settlor of the trust. “The notification by trustee shall contain the
following information: (1) The identity of the settlor … and the date of execution
of the trust instrument. (2) The name, mailing address and telephone number of
each trustee of the trust. (3) The address of the physical location where the

3      Appellant‟s opening brief asserts that he filed a petition in the trial court on
June 21, 2002. The brief discusses the contents of that petition and bases a large
portion of its argument on the petition. The petition, however, is not part of our
record on appeal, is not before the court, and was not the subject of the trial court‟s
ruling as far as we can tell; we disregard appellant‟s references to that petition.

principal place of administration of the trust is located .… (4) Any additional
information that may be expressly required by the terms of the trust instrument.
(5) A notification that the recipient is entitled, upon reasonable request to the
trustee, to receive from the trustee a true and complete copy of the terms of the
trust.” (§ 16061.7, subd. (g), paragraph breaks omitted.)
       If, as here, the notification by the trustee is served because a trust has
become irrevocable upon the death of a settlor, the notification must also “include
a warning, set out in a separate paragraph in not less than 10-point boldface type,
or a reasonable equivalent thereof, that states as follows: [¶] „You may not bring
an action to contest the trust more than 120 days from the date this notification by
the trustee is served upon you or 60 days from the date on which a copy of the
terms of the trust is mailed or personally delivered to you during that 120-day
period, whichever is later.‟” (§ 16061.7, subd. (h).)
       Section 16061.8 states that no person “upon whom the notification by the
trustee is served” may bring an action more than 120 days after service of the
notification or 60 days after a copy of the terms of the trust is mailed or delivered
to him or her during the 120-day period, “whichever is later.” The limitations
period is tolled while a section 21320 safe harbor proceeding is pending.
(§ 21308.)
       B. The Notice Served in this Case
       The notice served by respondents in the present case on July 16, 1999,
states that the trustees are providing the notice “as required by California Probate
Code Section 16061.7.” The notice identifies the trust, the trustees, and the place
of administration of the trust, all as required by section 16061.7, subdivision (g).
It provides in boldface the notification of the statute of limitations required in
section 16061.7, subdivision (h).

         The notice does not specifically state that a recipient of the notice is entitled
to a copy of the terms of the trust upon reasonable request, as required by section
16061.7, subdivision (g)(5). However, prior to service of the section 16061.7
notice, but after the death of the settlor, one of the trustees provided a copy of the
trust instrument to appellant by personal delivery.
         C. Contentions on Appeal*
         Even though he actually received a copy of the trust instrument before he
received the notification from the trustees, and even though he filed his safe harbor
petition within 120 days after service of the trustees‟ notification, appellant
contends the notice was ineffective to commence the section 16061.8 statute of
limitations because the notice did not comply with section 16061.7, subdivision
         Even though we held in our previous opinion that the third through seventh
claims in the proposed petition appellant submitted in the safe harbor proceeding
clearly invoked the no-contest clause of the trust to the extent they sought to allege
gifts to charities and nonrelated persons based on fraud or wrongdoing of those
beneficiaries or the settlor‟s incapacity, appellant contends on this appeal that
those claims arise under section 21350, subdivision (a), and are not governed by
the section 16061.8 statute of limitations.
         Finally, even though the trial court held that the statute of limitations
“possibly” has not expired as to appellant‟s claim that an oral promise superseded
the terms of decedent‟s will and trust, appellant contends the order must be
reversed because the applicable (two-year) statute of limitations had not expired at
the time he filed a petition “on June 21, 2002.” (See fn. 3, ante.)

*   See footnote on page 1, ante.

       D. Respondents’ Failure Strictly To Comply with Section 16061.7
       was not Prejudicial
       Relying on this court‟s opinion in Harustak v. Wilkins (2000) 84
Cal.App.4th 208, appellant contends respondents‟ failure strictly to comply with
section 16061.7 renders the trustees‟ notice a nullity. As a result, according to
appellant, statutes of limitations of three, four, or five years applicable to various
civil actions are applicable instead of the 120-day limitations period of section
16061.8. According to appellant, “There is no legal authority to support the
contention that the Court is to engage in a balancing of the equitable
circumstances to summarily determine an alleged lack of prejudice or
disadvantage” to a beneficiary so as to “cure deficiencies in a trustee‟s notice.”
       There is “legal authority” that “[t]he law neither does nor requires idle
acts.” (Civ. Code, § 3532.) In a case in which the trustee elects to provide the
beneficiary with the terms of the trust, requiring the same trustee to provide
subsequent notice to the beneficiary that he is entitled to that exact information is
indeed to require an idle act. We conclude that in such circumstances the law does
not require this idle act.
       Section 16061.7, subdivision (g) -- unlike subdivision (h) -- requires neither
a statement in particular terms nor a statement in a particular format. Instead,
subdivision (g) merely requires that the trustee provide “the following
information.” Thus, the statute here is unlike statutes in which the Legislature has
specified the text and format for a notice: in that circumstance, deviations from
the specified form will be viewed with extreme disfavor. (See Harold L. James,
Inc. v. Five Points Ranch, Inc. (1984) 158 Cal.App.3d 1, 6.)
       Although the issue of a prejudice requirement is not discussed in Harustak
v. Wilkins, supra, 84 Cal.App.4th 208, the case upon which appellant places most
of his reliance, that case dealt with an express statutory requirement (see

§ 16061.7, subd. (h)) as to both the required text and the required format of the
notice. (Harustak, supra, at p. 215.) Thus, even if Harustak were interpreted to
hold that the objective absence of the conspicuous notice required by statute made
moot the recipient‟s actual knowledge of the applicable statute of limitations, the
case does not control the present circumstances, in which there is a statutory
prescription for neither the text nor the form of the notice.
       Where the statute does not require a particular form of notice, cases
consistently hold that courts will look to the issue of prejudice when a party seeks
to excuse its own failings -- such as appellant‟s failure to file his petition attacking
the trust within 120 days of the trustee‟s notice -- based on a defect in statutory
notice provided by the other party -- such as the claimed omission from the
trustee‟s notice in this case.
       Thus, in a case cited by respondents, Oceanside Marina Towers Assn. v.
Oceanside Community Development Com. (1987) 187 Cal.App.3d 735, two
agencies were involved in joint consideration of the environmental impact of the
relocation of a railroad switchyard. The subordinate agency issued a notice
concerning the environmental impact, but the lead agency gave no notice
whatsoever, despite the statutory requirement that it do so. In holding that the
appellant‟s suit was barred by the 30-day statute of limitations that was
commenced upon promulgation of the notice by the lead agency, the court
concluded that the appellant had not been prejudiced by issuance of the notice by
the subordinate agency. Any other resolution of the issue, in the absence of such
prejudice, “would be a colossal elevation of form over substance.” (Id. at p. 741.)
       In Migliore v. Mid-Century Ins. Co. (2002) 97 Cal.App.4th 592, an insurer
sent the insured a letter denying coverage of a claim. An “unequivocal denial” of
the claim commenced the one-year limitations period for suing the insurer. (Id. at
p. 604.) The insured claimed the letter was defective for failing to notify her

unequivocally of the denial of the claim. (Id. at p. 606.) In considering whether
the insurance company was estopped by the omission from invoking the statute of
limitations, the appellate court set out the elements of estoppel and concluded that
“the evidence establishes that at all times appellant protested the amount paid on
her claim and respondent‟s determination not to provide further coverage.” (Id. at
pp. 606-607.) Thus, in the absence of prejudicial reliance on any possible
ambiguity in the letter, the insured could not rely on that alleged defect to forestall
commencement of the statute of limitations.
       By contrast, in Galloway v. Workers’ Comp. Appeals Bd. (1998) 63
Cal.App.4th 880, the court‟s prejudice analysis led it to conclude the employer
was estopped to claim commencement of the statute of limitations. Nevertheless,
the court expressly considered the issue of prejudice in determining that the
absence of the required notice relieved the employee from compliance with the
applicable limitations period. In Galloway, an applicable administrative code
provision required the employer to give the employee notice of the time limit for
filing a workers‟ compensation claim. The court stated that the absence of such
notice would not excuse a late claim by the employee if the employer could prove
the employee otherwise had knowledge of the limitations requirement -- in other
words, that the employee was not prejudiced. In Galloway, however, there was
“nothing in the record to show that [the employee] knew what the appropriate time
limits were” in the absence of the statutory notice. (Id. at p. 887.)
       Appellant has not cited a single case in which one party‟s failure to provide
“information” to the other party as required by statute has resulted in a tolling of
the statute of limitations in the absence of prejudice to the party designated to
receive the information. To employ the pithy language of Justice Weiner (in a
slightly different context), appellant “is asking us to declare the statutory notice
procedures followed in this case … insufficient … even though it cannot allege

that additional notice … would have made any difference .…” (Oceanside
Marina Towers Assn. v. Oceanside Community Development Com., supra, 187
Cal.App.3d at p. 744.) Neither precedent nor common sense requires us to do so.

         E. The Law of the Case Precludes Appellant’s Argument as to His
         Third through Seventh Claims*
         In our previous opinion in this case, we held that the third through seventh
claims proposed by appellant could reasonably be interpreted as challenges to
particular gifts to presumptively disqualified persons. As such, those challenges
arise under section 21350 and are subject to the separate three-year statute of
limitations in section 21356, subdivision (b).
         However, we also held that, to the extent those claims sought to challenge
the trust itself, whether on the basis of fraud or other misconduct of the
presumptively disqualified persons or on the basis of a claim the settlor was
incompetent, they were a proper subject of the section 21320 proceeding.
(F036004, slip op. at pp. 17-18.) As a necessary consequence of that
determination, the claims are subject to the section 16061.8 statute of limitations
to the extent they seek to invalidate the trust itself.
         Nevertheless -- and without any attempt to address our prior holding --
appellant contends his third through seventh claims permit an attack on the trust
itself under section 21350. For reasons explained in our prior opinion, section
21350 permits only the limited relief of setting aside donative transfers to the
presumptively disqualified beneficiaries. That section does not permit an attack
on the overall terms of the trust.

*   See footnote on page 1, ante.

         F. The Eighth Proposed Claim is Barred by the Statute of
         Appellant contends there was an oral agreement between himself and
decedent by which decedent promised to leave appellant the equivalent of an
intestate share of decedent‟s estate. This contention was asserted as the eighth
claim in appellant‟s proposed petition submitted to the trial court in the safe harbor
proceeding. We determined on the prior appeal that this claim constituted a
contest of decedent‟s trust because, “[o]bviously, the eighth request for relief
seeks, whether through modification of the terms of the trust or by imposition of a
constructive trust, to nullify the dispositive provisions of the trust as those
provisions were established by decedent.” (F036004, slip opn. at 19.) Our
determination expressly was based on the language of the eighth proposed claim,
which sought to modify the terms of the trust or to impose a constructive trust on
the corpus of the trust established by decedent.
         As “an action to contest the trust” (§ 16061.8), the eighth proposed claim
was subject to section 16061.8‟s 120-day statute of limitations. On remand, the
trial court correctly held as much.
         The trial court also noted -- correctly -- that it could not rule in the abstract
about any and all conceivable formulations for the assertion of appellant‟s oral-
agreement claim. Impliedly, the court concluded there might be such a
formulation that was not a contest of the trust for purposes of section 16061.8, yet
still was a contest of the trust under the terms of the trust itself. As such, the claim
would not be barred by section 16061.8 but would, whether successful or not,
result in forfeiture of the trust benefits otherwise conferred on the claimant. Such
an alternative formulation, such as a will contest or a claim against other persons
for intentional interference with a contract, would have to be evaluated when and

*   See footnote on page 1, ante.

if it were filed to determine whether it constituted a contest of the trust for
purposes of section 16061.8.4
       The trial court‟s caveat concerning a “possible exception” to its ruling
concerning the proposed petition was nothing more that an appropriate recognition
that its ruling was limited to the claims and proposed relief contained in the
proposed petition. As to the eighth proposed claim, the court‟s ruling was
unequivocal and was required by the law of the case as established in our previous
opinion; as to the universe of hypothetical alternative formulations, the court did
not purport to rule and, in not ruling, did not err.
       The order on petition for instructions regarding limitations of actions to
contest trust is affirmed. Respondents are awarded costs on appeal.

                                                              VARTABEDIAN, J.


DIBIASO, Acting P. J.


4      We do not mean to imply that facts exist that would support such
alternative formulations and we express no opinion on the timeliness, legal basis,
or factual merit of any hypothetical cause of action. Further, we reiterate that the
petition appellant apparently filed on June 21, 2002, is not before us and, to the
extent it may differ from the proposed petition filed in the section 21320
proceeding, we express no opinion concerning that petition.


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