Trusts & Estates Bulletin

A Compendium of Recent Cases

  Brought to you by LACBA's Trusts & Estates Section   *  Volume II, Number 4  *  August, 2006

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IN THIS ISSUE:

 
Thomas v. Gustafson 
Laycock v. Hammer
Auerbach v. Assessment Appeals Board No. 1 (Northern Trust Bank of Calif.)Estate of Dehgani-Fard
Estate of Stevenson

Trusts & Estates Bulletin is published monthly by the Trusts & Estates Section of the Los Angeles County Bar Association (LACBA).

David C. Nelson,
Loeb & Loeb LLP, Editor
dnelson@loeb.com

 

(Cases appear in chronological order, with the oldest cases appearing first.) 

-Trusts and Estates-
Trial court properly considered beneficiary’s assets in determining whether trustee abused discretion by refusing to invade principal of trust for beneficiary’s support. Trial court erred in dividing trustee’s fees and costs between income and principal of trust; where litigation primarily concerned the principal, fees and costs must be paid from that principal. Trial court did not abuse its discretion in denying request for payment from trust of attorney fees incurred by petitioner who unsuccessfully sought to invade trust principal for support of beneficiary.
Thomas v. Gustafson - filed July 6, 2006, Third District; Cite as 2006 SOS 3505
Full text

-Trusts and Estates-
Where decedent purchased life insurance policy before his death and assigned all his interest in the policy, including the right to any benefits, to an irrevocable life insurance trust he had established, decedent’s conduct after trust had been established did not alter the irrevocable nature of trust so as to be subject to claims of creditor. Policy proceeds were property of the trust, not decedent’s estate.
Laycock v. Hammer - filed July 6, 2006, Fourth District, Div. One; Cite as 2006 SOS 3501
Full text 

-Taxation-
Change in ownership of land that was subject to long-term lease constituted for Proposition 13 purposes a change in ownership of building on that property whose construction commenced during the lease term, triggering reassessment.
Auerbach v. Assessment Appeals Board No. 1 (Northern Trust Bank of California) - filed July 17, 2006
Cite as 2006 SOS 3710
Full text 

-Trusts and Estates-
Where probate order provided for after-discovered assets of decedent to be distributed proportionally among four residual beneficiaries, including educational institution with tax-exempt status, and executor claimed charitable income tax deduction for portion of after-discovered income attributable to institution's share of estate, institution was exempt from liability for income tax attributable to its portion of after-discovered assets, and trial court abused its discretion in failing to allocate tax liability only among other three beneficiaries.
Estate of Dehgani-Fard - filed July 24, 2006, Second District, Div. Four; Cite as 2006 SOS 3897
Full text 

-Trusts and Estates-
Where attorney for administrator of estate was to be paid under fee agreement for total number of hours based on hourly rates regardless of outcome, and existence and value of assets in estate determined only whether fee award would be based on normal hourly rates or double those rates, fee agreement was not enforceable as a contingency fee agreement within meaning of Probate Code Sec. 10811(c), which permits an attorney for administrator of estate to be paid for extraordinary services under a contingency fee agreement if trial court approves agreement after a noticed hearing. Alternatively, attorney was not entitled to fees according to plain terms of agreement where creditors had significant interest in knowing about attorney’s compensation before negotiating with estate to reduce amount of their claims, but trial court failed to give creditors notice of hearing on petition to approve fee agreement. Fee award of $200,000, as opposed to $1.25 million award that was requested, was just and reasonable where estate’s assets did not exceed $700,000, and estate still owed $1.7 million to creditors.
Estate of Stevenson - filed July 31, 2006, Second District, Div. One
Cite as 2006 SOS 4007
Full text