Los Angeles Probate Litigation Attorney Blog

Update to a post from 2012 concerning the Conservatorship of Zsa Zsa Gabor.

Previously, Gabor's only child, 64-year-old Constance Francesca Hilton, asked a California court to establish a conservatorship to mange her mother's care and protect her assets. Zsa Zsa Gabor's daughter filed a conservatorship petition to gain control over her mother's assets after she accused Gabor's husband, Frederic von Anhalt, of mishandling the estate. Hilton also asked that she be appointed her mother's conservator. Last year, Hilton alleged in her court filing that von Anhalt isolated Gabor from family and friends and she was concerned because her mother appeared to be heavily sedated during each of her last two visits. Gabor's husband of 25 years, 68-year-old Frederic Prinz von Anhalt, opposed Hilton's petition. Von Anhalt countered that Hilton was unfit to serve as conservator and accused her of abusing a previous power of attorney.

It appears that recently, the Honorable Judge Reva Goetz, of the Los Angeles Superior Court, Central District has issued a one-page order that would extend the Frederic von Anhalt's conservatorship over Zsa Zsa Gabor and her assets. The Judge Goetz originally appointed von Anhalt to be Gabor's temporary conservator on July 11, 2012. The new order would extend the conservatorship until August 21, 2013.

Last summer, in a court filing, a doctor who evaluated Gabor cautioned that it was in the aging actress's best interests to remain in a familiar environment. Dr. Debra Judelson described Gabor as bedridden and largely unresponsive. Judelson stated the actress became agitated whenever she was removed from the familiarity of her own bedroom. The doctor also reportedly witnessed Gabor calm down when her husband spoke to her or touched her hand.

A California conservatorship exists when a judge appoints a responsible person or other entity to care for an adult who can no longer manage their own financial matters or care for themselves. After a conservator is appointed by a court, he or she is responsible for the conservatee's protection and care as well as the management of the individual's assets. In general, a spouse or domestic partner, relative, interested governmental entity, interested person or friend, or the conservatee may request a California conservatorship. If you feel someone close to you would benefit from a conservatorship, contact a knowledgeable Southern California probate lawyer to discuss your concerns. We can be reach at (310 914-3222 or (714) 280-0601.

California law provides that conservatorships can be created for people who are incapacitated and cannot manage their own affairs. A conservator has many powers and responsibilities, which can include the ability to make medical and financial decisions on the incapacitated person's behalf.

Firm partner, Yasha Bronshteyn was in attendance at The Beverly Hills Bar Association sponsored Lunch with the Probate Judges on March 19, 2013, at Lawry's in Beverly Hills. Supervising Judge Mitchell L. Beckloff, Judge Reva G. Goetz, Judge Michael I. Levanas, and Judge Roy Paul were part of the distinguished panel and addressed questions and concerns which were submitted by the Trust & Estates Members Section.

In essence California's budget crisis is bringing about drastic change at the courts, affecting practitioners of all types, including those handling trust & estate litigation, special needs trusts, trust contests, fiduciary accounting, trust accounting, probate administration, conservatorships, and elder abuse.

NEW PROBATE CASE FILINGS

Effective April 8, 2013, except as to those cases that may be filed in the North
District (which is Lancaster) pursuant to LASC Local Rule 2.3 (a)(1)(B), all Los Angeles Superior Court probate cases must be filed in the Stanley Mosk Courthouse, located at 111 N. Hill St., Los Angeles, California 90012.

TRANSFER OF EXISTING PROBATE CASES

There will be no transfer of existing probate cases from the North District. In all other districts, on June 10, 2013, all probate cases pending in district courthouses will be transferred to Department 29 in the Central District. Individual transfer notices for each reassigned case will be sent to the petitioning parties.

Dementia, whether spurred by Alzheimer's disease or other causes, is becoming an ever-increasing issue. With studies and forecasts universally predicting a continued dramatic rise in the occurrence of dementia in the decades ahead, the number of families touched by dementia will similarly grow, placing an increasing spotlight on the need for proper estate planning to address the issue of incapacity. It may be prudent to nominate an individual to serve as conservator of the person in the event a conservator of the person is to be appointed.

Studies performed by a variety of sources uniformly agree that the incidence of Alzheimer's and other dementias is increasing significantly. In 2012, the Alzheimer's Association concluded that the number of Alzheimer's disease cases in the U.S. totaled around 5.4 million, and predicted the number of annual new cases in 2050 would be double the current rate of new diagnoses. Studies agree that the likelihood of developing Alzheimer's increases with age. 96 percent of currently diagnosed Alzheimer's patients in the U.S. are age 65 or older. As medical technology and access to health care improve, and the number of people living beyond the age of 65 increases, so too will the number of dementia cases.

Closer to home, a separate Alzheimer's Association report concluded that more than 588,000 California families were living with the disease in 2008. The association estimated that number to swell to 678,000 in 2015, and nearly 1.15 million by 2030. Being diagnosed with Alzheimer's does not automatically make you incapacitated under California law. According to Section 811 of the Probate Code, incapacity requires a significant impairment of the ability to understand and appreciate the consequences of his or her actions brought on by a deficit in one or more of: alertness and attention, processing of information, clear thinking, and ability to control and regulate mood and affect.

Continue reading "Report Predicts Alzheimer's, Other Dementia to Double by 2050" »

A California woman serving as a conservator lost her defamation lawsuit against a Sacramento television station as an appeals court concluded that she could not prove that the reports aired the report with knowledge that their information was false, or at least reckless disregard for its falsity. In reaching it conclusion, the court in Young v. CBS decided that, because conservators are very powerful agents acting under the authority of a court order, and could reasonably trigger scrutiny by the public, they are public figures for purposes of defamation lawsuits. The ruling serves as a warning to any a conservator in California, making clear that, by accepting an appointment as a conservator, any person may subject him/herself to public figure status, and a much more difficult path to recovery, if he/she believes he/she is defamed by a news organization.

In November 2006, Sacramento County Adult Protective Services asked Carolyn Young to serve as the conservator for an allegedly incapacitated adult, 86-year-old Mary Jane Mann. Young, a professional conservator and fiduciary for more than a decade and a half, petitioned the court for the appointment. Almost immediately after the court appointed Young as temporary conservator, the senior and one of her daughters, Monika Mann, began contesting the conservatorship. A non-judicial mediation yielded an agreement where Young agreed to petition for dissolution of the conservatorship in exchange for Young becoming a co-trustee of Mann's trust.

Shortly thereafter, the CBS television station in Sacramento, KOVR-TV, investigated the Mann conservatorship. A week later, KOVR aired a news story entitled "A Life Hijacked," which stated that Young "effectively took over Mann's life without Mann's knowledge [including] Mann's bank accounts, investments, and her trust. Young had Mann's mail forwarded to her office and had Mann's driver's license lifted." The report went on to claim, or insinuate, that Young stole from Mann, threatened her, battered her and trespassed onto her property.

Young sued CBS for defamation. On appeal, the California Court of Appeal ultimately ruled for CBS and ordered the trial court to dismiss Young's lawsuit.

Continue reading "California Court Rules Against Conservator in Defamation Lawsuit" »

A family's trust dispute got new life when the California Supreme Court reversed an an appellate court ruling, and determined that a group of contingent beneficiaries did, as a matter of law, have standing to sue the trustee of a family trust for breaching his duties by making a large, risky investment in a company that the trustee co-owned. In deciding Estate of Giraldin, the court concluded that, under California law, because the trustee's actions could harm the contingent beneficiaries and contravene the wishes of the deceased trustor, they had standing to sue.

In 2001, William Giraldin began considering investing $4 million, roughly 2/3 of his wealth, in a technological start-up company created by Patrick Giraldin, his son. Patrick's twin, Tim, was also a partial owner. Soon thereafter, Bill created a new revocable trust, which essentially replaced the previous revocable trust he established in 1997, naming all of his children as contingent beneficiaries. In one key difference between the trusts, however, Tim, not Bill, served as trustee of the trust. Bill ultimately decided to make the investment, with the funds coming from the trust.

The start-up proved unsuccessful and, by the time Bill died in May 2005, his investment was largely worthless. Four of Tim's half-siblings sued him, claiming he violated his fiduciary duties to the trust's beneficiaries. The suit claimed that Tim's mismanagement deprived Bill's seven other legal children of the benefit of the trust.

The trial court ruled in favor of the four children. The court concluded that Tim acted to serve his interests, and those of the start-up, at the peril of his father and the trust.

The California Court of Appeal reversed. The court determined that Cal. Prob. Code 15800 made clear that, during Bill's lifetime, Tim's duties were to his father alone, not his siblings (as trust beneficiaries). During's Bill's lifetime, the Court of Appeal concluded, Tim's siblings were akin to heirs named in a will, possessing no rights until Bill died and the trust became irrevocable. Thus, the siblings lacked standing to sue for his pre-May 2005 conduct as trustee.

The California Supreme Court disagreed, however. The high court agreed that the siblings could not sue based on alleged financial harm they suffered during Bill's lifetime, and could not sue while Bill was alive, but concluded that they could assert a claim after Bill's death, based upon harm to Bill caused by Tim's actions during Bill's lifetime. "Because a trustee's breach of the fiduciary duty owed to the settlor can substantially harm the beneficiaries by reducing the trust's value against the settlor's wishes, we conclude the beneficiaries do have standing to sue for a breach of that duty after the settlor has died," the court wrote.

Continue reading "Contingent Beneficiaries Can Pursue Trustee for Squandering Trust's Assets, High Court Says" »

A "no contest" clause is an item inserted into many wills and/or trusts to reduce the likelihood that a beneficiary will mount a court challenge to the document. The California legislature modified the statute governing no contest clauses in recent years, attempting to simply the law regarding these provisions. In the process, however, the state's new statute creates some potential traps for the unwary beneficiary.

Under California law in effect before 2010, will or trust contests were a high-stakes, all-or-nothing proposition. For example, if a woman had a will that left her estate equally to her son and daughter but, shortly before her death and during a visit from her daughter, she created a new will, with a no contest provision, leaving 75% of her assets to the daughter, and 25% to the son, then the son would face a risky dilemma if he contested the new will. If he won, the first will would govern, and he would receive one-half of his mother's estate; lose, and the no contest clause from the second will would take effect and he would receive nothing.

Finding the penalty of total forfeiture excessively punitive, the legislature changed the law, effective 2010. The new law states that forfeiture clauses are generally not enforceable against challengers if they had probable cause for bringing the action.

Beneficiaries should remain mindful, though, that there are indirect ways to trigger a forfeiture clause, some of which are not necessarily intuitive. In a 2002 case, Estate of Gonzalez, a group of siblings offered their father's 1992 will for probate, which contained a no contest provision. A fourth sibling, Jorge Gonzalez, submitted for probate a 1998 will. The court concluded that the 1998 will was the result of Jorge's undue influence, that Jorge knew the will was not valid and, by offering it for probate, he effectively challenged his father's first will, and did so without probable cause. As a result, the no contest clause within the 1992 will was enforceable and Jorge received nothing from his father's estate.

Continue reading "Dealing with No Contest Clauses in California Wills, Trusts" »

A California appellate court upheld the right of the children of a man's ex-wife to receive the distributions promised to them in the man's will and trust. In Estate of Lira, the court rejected a daughter's argument that her father's ex-wife's children were disqualified from inheriting, ruling that the ex-wife's family was related to the man when he executed his estate plan documents and, therefore, exempt from disqualification.

Oligario Lira married Mary Terrones in 1968. Lira had three children from a prior marriage, and his wife had six. Early in 2008, the wife filed for divorce. Eleven months later, with the divorce still pending, Oligario executed a will and a trust. The documents named Oligario's three children, as well as three of Mary's sons, as beneficiaries of his estate, and named Mary's son, Robert Terrones, personal representative of his will and trustee of his trust. One of Mary's grandsons, Glenn Terrones, was an attorney and prepared the documents for Oligario. The court granted the divorce early in 2010, and Oligario died five months later.

Lira's daughter, Mary Ratcliff, petitioned for probate of her father's estate, stating that her father died intestate, and requesting that the court appoint her to administer the estate. Two months later, Robert filed his own petition, producing the will and asking that the court name him as executor. Lira's daughter then argued that the law disqualified the Terrones sons from receiving anything under the will or the trust because they were related to the attorney who drafted the documents. Robert countered by contending that, because he and his brothers were related to Oligario when he signed the documents, they were exempt from disqualification.

A trial court, and the California Court of Appeal, agreed with Robert. While Section 21350 of the Probate Code, which the daughter cited, generally bars anyone who is "related by blood or marriage to, is a domestic partner of, is a cohabitant with, or is an employee of, the person who drafted the instrument" from receiving a distribution under that document, Section 21351 carves an exemption for persons related to the transferor by blood or marriage.

Continue reading "Children of Ex-wife Entitled to Take in Accordance with Man's Will, Trust, Court Rules" »

A now-deceased man's estate planning oversight yielded a dispute that will now be decided by the U.S. Supreme Court. The case of Hillman v. Maretta pits the man's ex-wife, whom he named, and never replaced, as the death beneficiary on a life insurance policy, and the man's current wife, who claimed that the ex-wife lost her claim to the money when she and the man divorced.

In 1996, Warren Hillman named Judy Maretta, his wife, as the primary beneficiary on his Federal Employees' Group Life Insurance (FEGLI) policy. Two years later, the couple divorced. Hillman married his subsequent wife, Jacqueline, in 2002. Warren and Jacqueline remained married until Warren died in 2008. However, Warren never updated his insurance policy to remove Judy and name a new beneficiary.

Jacqueline filed a claim for the policy benefit, which was nearly $125,000. Judy also filed a claim for the benefit. The money went to the ex-wife, as she remained the named beneficiary under the policy. Jacqueline sued, arguing that, under Virginia law, Warren and Judy's divorce automatically revoked the beneficiary designation naming Judy. Judy contended, and the Virginia Supreme Court agreed, that the Virginia statute did not control here. The federal statutes governing FEGLI expressly state that the order of precedence for receiving a death benefit gives first priority to "the beneficiary or beneficiaries designated by the employee," (5 USC 8705(a)) and also that the "provisions of any contract under this chapter which relate to the nature or extent of coverage or benefits (including payments with respect to benefits) shall supersede and preempt any law of any State or political subdivision thereof... to the extent that the law or regulation is inconsistent with the contractual provisions" (5 USC 8709(d)(1).) The Virginia court determined that these federal statutes clearly pre-empted Virginia law and mandated awarding the funds to Judy.

The U.S. Supreme Court agreed to take the case as a split had emerged over the question, with the Virginia and Alabama high courts, along with the federal 7th Circuit and 11th Circuit appellate courts, ruling that FEGLI's governing statutes pre-empted state law, but the high courts in Indiana and Mississippi concluding that the federal statutes regarding FEGLI did not pre-empt state law.

Continue reading "High Court to Review Case Awarding Insurance Proceeds to Ex-wife" »

A surviving spouse argued, to no avail, that his marriage to his registered domestic partner served as an automatic invalidation of the couple's domestic partnership agreement regarding property and assets. In Konou v. Wilson, the California Court of Appeal ruled that the agreement served a similar function to a pre-nuptial agreement, and the couple's marriage did nothing to void it.

In 1986, Philip Wilson created a will, leaving half his estate to his siblings, and the other half to Douglas Vanderburg, his registered domestic partner. The couple later terminated their partnership in 1993. In 2005, Wilson began a relationship with Antipas Konou. The couple signed a domestic partnership agreement in 2006. In the agreement, each partner disclaimed any present or future right to the assets, income or estate of the other. The couple registered as domestic partners in 2006, and married in San Francisco in the summer of 2008. Later that year, Wilson committed suicide.

In January 2009, Vanderburg disclaimed his rights under Wilson's will. Konou sought to inherit from Wilson's estate as an omitted spouse. Wilson's siblings objected.

The trial court agreed that Konou qualified as a pretermitted spouse. Under Cal. Prob. Code 21610, "if a decedent fails to provide in a testamentary instrument for the decedent's surviving spouse who married the decedent after the execution of all of the decedent's testamentary instruments," then that spouse is deemed legally pretermitted and, normally, entitled to a share of decedent's estate as set out by the statute.

However, the existence of the domestic partnership agreement proved the undoing to Konou's case. The agreement expressly disclaimed any right either partner had in the estate of the other. The court further concluded that Konou's marriage to Wilson did not void the domestic partnership agreement, which constituted a valid waiver of his rights to Wilson's estate.

Continue reading "California Couple's Marriage License Did Not Automatically Wipe Out Terms of Domestic Partnership Agreement" »

A judge recently approved the sale of the home of former Playboy Playmate Anna Nicole Smith. The proceeds from the sale will go to the late model's six-year-old daughter, Dannielynn. Many may remember Anna Nicole Smith for her marriage to the late J. Howard Marshall, an oil industry magnate.

According to a local news article, the home sold for $1.3 million, despite being worth approximately $1.8 million at the time of Smith's death in 2007. The buyer is reportedly Rouzbeh Zoka, trustee of the Rouzbeh Zoka 2012 revocable trust.

Howard K. Stern, Smith's former lawyer and now executor of her estate, reportedly stated that the sale of the home was "to the advantage of the estate and in the best interest of the interested persons." The "interested persons" in this case is Smith's daughter, Dannielynn.

California estate and probate law is on its face relatively straightforward, but can become very complex very quickly. When a person dies, his or her real and personal property form an estate. The estate includes any income, investments, real estate, and possessions of the person who died (known as the "decedent"). The decedent before dying or in a will may name someone--either a person or an entity, such as a bank or charity--to serve as the executor of the estate. In this case, Smith had apparently named her attorney Howard K. Stern as the executor of her estate. The executor is charged with managing the estate's liabilities and distributing the estate's assets to the named beneficiaries (in this case, Smith's daughter). The primary responsibility of distributing the proceeds of the sale of Smith's home will fall on Stern as executor of her estate.

It can become more complex when there are disputes over the decedent's intent. For example, when a person dies, they might have named only some, but not all of his or her children in a will. Most likely, the unnamed children would contest the validity of the will, and estate litigation may ensue to determine whether the decedent intended to omit certain children or whether the omission was unintentional. This is but one example of a dispute that can arise in the execution of an estate plan. If you or someone you know is dealing with a dispute over the administration or execution of trust or estate in California, you should contact an experienced trusts and estates litigation attorney to ensure your interests are represented.

Continue reading "Anna Nicole Smith's Studio City Home Sells, Proceeds to Go to Daughter" »

On November 19, 2012, in Department 11 of the Los Angeles County Superior Court, Judge Michael I. Levanas was set to determine whether the Ariel Winter, the 14-year-old teen star of "Modern Family," should continue living with Shanelle Gray, her adult sister. Shanelle Gray has had temporary guardianship of the actress since October 3, 2012, when Judge Levanas temporarily stripped Chrisoula Workman of custody of her daughter. The issue is ultimately the "Modern Family" star should stay away from her mother, who has been described in court documents as physically and emotionally abusive.

Workman has denied all accusations of abuse and filed more than two dozen declarations from friends, acquaintances, stylists and others saying they never witnessed any abuse. Winter's father, Glenn Workman, also filed an objection to the guardianship, stating he wants a better relationship with his daughter and would be willing to care for her.

Los Angeles County Superior Court Judge Michael I. Levanas said a county Department of Children and Family Services report found that allegations that Winter's mother emotionally abused her were substantiated, while the department found physical abuse allegations inconclusive.

A trial to determine whether Gray gains permanent guardianship of her sister has been scheduled for December 12, 2012. Judge Levanas said the case would be removed from his courtroom if the Department of Children and Family Services filed its own case.

Day long conference to be presented on November 9, 2012, by USC Gould School of Law at the Millennium Biltmore Hotel. Always top notch program. Subjects to be covered this year include Recent Developments in Probate and Trust Law, Current Elder Law Issues and Practical Considerations, Creditor Claims, Trustee Compensation, Recent California Legislation, and Anticipated 2012 Sunset of Complex and Controversial Tax Acts of 2001.

On September 19, 2012, firm partner, Yasha Bronshteyn attended the Special Needs Trust Seminar presented by Wells Fargo Bank and sponsored by the Barlow Foundation, Goodwill Southern California, and the United Rescue Mission. The assets in a properly established Special Needs Trust (SNT) will not be counted toward the Supplemental Security Income (SSI), Medi-Cal and In-Home Support Services (IHSS) asset limit of $2000 for an individual.

California Probate Code Section 3604 states that if a court makes an order under Section 3602 or 3611 that money of a minor or person with a disability be paid to a special needs trust, the terms of the trust shall be reviewed and approved by the court and shall satisfy the requirements of this section. The trust is subject to continuing jurisdiction of the court, and is subject to court supervision to the extent determined by the court.

Depending on particular circumstances notice of the time and place of the hearing on the Petition to Exclude Funds from Estate and to Direct Payment to Special Needs Trust and a copy of the petition will be given to the State Director of Health Services, the State Director of Mental Health and the State Director of Developmental Services as required by law.

The law and rules surrounding Special Needs Trusts can be complicated. As such please seek proper legal counsel.

On August 22, 2012, Los Angeles Superior Court Judge Mitchell Beckloff finalized a co-guardianship agreement for the late Michael Jackson's three children. Katherine Jackson and T.J. Jackson, will be sharing the responsibilities concerning Prince, 15, Paris, 14, and Blanket, 10. During an earlier hearing on August 2nd, Judge Beckloff said a court appointed investigator had visited Katherine's home in Calabasas, California and that she has been doing a "wonderful job" as guardian and that the children love her. Beckloff also went on to say that the "kids have a substantial, significant relationship with T.J. Jackson and love him very much."

California guardianships most commonly apply to children whereas conservatorships most commonly apply to adults. The purpose of Guardianships is to provide individuals with legal authority to watch over the well being of a minor child. The guardian of the person has the responsibility for the care and custody of the child. As guardian, responsibilities include providing for food, clothing, shelter, education, and all of the medical and dental needs of the child. The guardian must also provide for the safety, protection, and physical and emotional growth of the child. The guardian is also responsible for decisions regarding the education, residence, and medical treatment of the child.

For more information about guardianships and conservatorships, contact the Calabasas Probate attorneys at Ginzburg & Bronshteyn, LLP.

On July 31, 2012, firm partner, Yasha Bronshteyn attended roundtable discussion regarding Key Issues for Leaders of Business and the Community at the UCLA School of Law with Chief Judge of the U.S. Court of Appeals for the Ninth Circuit Alex Kozinski; former Chief Judge of the U.S. Court of Appeals for the Tenth Circuit Deanell Reece Tacha, now Dean of the Pepperdine University School of Law; and Norman L. Epstein, Presiding Judge of the California Court of Appeal (Second District, Division 4), and Dean Rachel Moran of the UCLA School of Law amongst others in attendance.

Key issues discussed included; how companies and other groups can be effectively represented in court; and what budgets are needed for efficient operation of the courts to enhance timeliness and reduce the cost of litigation for the parties.