Monday, November 8, 2010

New California trust case holding that trust was not ambiguous as to predeceased son's issue born out of wedlock.

Citizens Business Bank v. Carrano (California Court of Appeal, Second District, B216632, November 8, 2010) holding that a trust that provided for assets to be distributed to a predeceased child’s issue, which term the trust specifically defined as lineal descendants of all degrees, but expressly excluding persons adopted either into or out of the Trustors’ bloodline, was not unambiguous for failure to address the “special case” of the predeceased child’s out-of-wedlock offspring, did not create a latent ambiguity, and was not in need of interpretation particularly where the Trustors were aware of their predeceased son’s lifestyle and of the several children born to him out of wedlock but nonetheless failed to include trust language excluding such children as beneficiaries, absent the childrens’ adoption into another home.