Trusts & Estates Bulletin

A Compendium of Recent Cases

  Brought to you by LACBA's Trusts & Estates Section   *  Volume III, Number 8 * February 2008
An E-Publication of the Los Angeles County Bar Association  *  Contact Us  *  Join the T & E Section  *  Archived Issues


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


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

-Trusts and Estates-
Where decedent’s grandson filed suit as decedent’s successor in interest against bank for releasing funds to decedent’s son, and court dismissed action because a probate proceeding was already pending, plaintiff was liable to bank for attorney fees under Civil Code 1717(a), even though he was not a signatory to account agreement awarding fees in actions to enforce it, because he stood in decedent’s shoes as successor in interest and would have been entitled to attorney fees had he prevailed. Plaintiff failed to demonstrate that estate should be liable for attorney fee award because the cause of action upon which he sued had passed to him, and any judgment would have gone to him, not to the estate.
     Exarhos v. Exarhos - filed January 10, 2008, Fourth District, Div. One
     Cite as 2008 SOS 131
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Trust could subtract investment advisory fees that it incurred from its federal taxable income as itemized deductions under 26 U.S.C. Sec. 63(d) but only to the extent that they exceed 2 percent of adjusted gross income under Sec. 67(e)(1). Exception from 2 percent floor for costs that "would not have been incurred if the property were not held in such trust" applied only to costs that would be uncommon for a hypothetical individual investor to incur and did not apply to investment advice that a prudent investor with the same investment objectives handling his own affairs would seek.
     Knight v. Commissioner of Internal Revenue - filed January 16, 2008
     Cite as 06-1286  
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-Business and Corporations Law-
Securities Litigation Uniform Standards Act of 1998 precludes state-law action by beneficiaries of trust administered by bank from suing bank for alleged misrepresentations and omission of material facts with respect to investment practices; such action was "in connection with the purchase or sale" of securities even though beneficiaries lacked investment authority. Where plaintiffs’ action was precluded by SLUSA, plaintiffs were entitled to amend complaint to assert state claims for a group of fewer than 50 plaintiffs or exclude allegations that trigger SLUSA preclusion.
     Wells Fargo Bank, N.A. v. Superior Court (Richtenburg) - filed January 25, 2008, First District, Div. One
     Cite as 2008 SOS 584
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