CALIFORNIA TRUST LAW DEVELOPMENTS

Balian v. Balian (California Courts of Appeal, December 11, 2009)

Mary J. Balian Revocable Trust provided that upon Mary’s death the trust residue would be divided equally into four parts for her four children, Alexander, George, Patricia and Diane. Upon Mary’s death Alexander and George became the designated co-trustees. A special needs provision provided that Patricia and Diane would receive monthly payments. The trust also contained a no contest clause that stated that a beneficiary who contested the trust would be disinherited.

Patricia petitioned the court to determine whether a petition to modify the amount of her monthly distribution would violate the no contest clause. The probate court granted the petition, holding that the proposed petition would not violate the no contest clause. On appeal, the appellate court affirmed the probate court’s decision, holding that the trustor’s intent controls, and that a proposed petition to modify a special needs provision in a trust must be pursued under section 15409, which specifically does not violate a no contest clause pursuant to section 21305.

This case also is of note because on January 1, 2010, pursuant to new legislation, many of the California probate code no contest statutes changed for instruments that became irrevocable on or after January 1, 2001. These changes will be the subject of later blogs.

Regards,
Dave Tate, Esq. (San Francisco and Beyond)
http://davidtate.us
tateatty@yahoo.com
http://www.tatecommonsensical.blogspot.com/
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