Balistreri v. Balistreri ( 2022 )

Filed 2/24/22
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIRST APPELLATE DISTRICT
DIVISION THREE
MARY A. NIVALA BALISTRERI, as
Trustee, etc.,
Plaintiff and Appellant, A162222
v. (San Francisco City & County
SAL J. BALISTRERI, Super. Ct. No. PTR-20-303610)
Defendant and Respondent.
Mary A. Nivala Balistreri filed a petition in probate court alleging that,
the day before her husband, Sal C. Balistreri, (decedent) died, the two
amended their revocable trust. The probate court subsequently deemed the
alleged amendment “null and void” and denied Mary’s petition to construe
the trust and confirm the validity of the amendment. The court concluded
the claimed amendment was invalid under Probate Code section 154021
because the trust mandated that any amendment “shall be made by written
instrument signed, with signature acknowledged by a notary public,” and the
amendment was not so acknowledged.
Mary appeals. We affirm and hold that, when a trust specifies a
method of amendment — regardless of whether the method of amendment is
exclusive or permissive, and regardless of whether the trust provides for
1Undesignated statutory references are to the Probate Code. We use
family members’ first names for convenience, intending no disrespect, and we
recite only those facts necessary to resolve the issues on appeal.
1
identical or different methods of amendment and revocation — section 15402
provides no basis for validating an amendment that was not executed in
compliance with that method.
BACKGROUND
Mary and the decedent were married and had a daughter, Julia. The
decedent also had children from prior marriages, including Sal and Christina.
In 2006, Mary and the decedent created a trust, which they restated,
renamed, and amended in 2008. The documents restating, renaming, and
amending the trust were notarized. In 2017, Mary and the decedent
amended the trust a second time. That amendment was notarized too. On
September 6, 2017, Mary and the decedent revoked the trust. Again, the
revocation was notarized.
On that same date, Mary and the decedent created the Balistreri
Family Trust (Trust), the trust at issue here. They named themselves
trustors and trustees, and they placed community property located on 23rd
Street in San Francisco (the property) in the Trust. Section 7.2.1 of the Trust
provides that upon the decedent’s death, the property “shall be distributed
equally among” Julia, Sal, and Christina.
In section 5.2.1, a reservation of rights provision, Mary and the
decedent agreed that the Trust “may be revoked or terminated, in whole or in
part, by either of us as to any separate property of that trustor and as to any
of our community property. During our joint lifetimes, this Trust may be
modified and amended by either of us acting alone as to any separate
property of that trustor, and by both of us acting jointly as to any of our
community property.” Section 5.2.4 mandates that “[a]ny amendment,
revocation, or termination . . . shall be made by written instrument signed,
2
with signature acknowledged by a notary public, by the trustor(s) making the
revocation, amendment, or termination, and delivered to the trustee.”
Mary alleged that in February 2020, the decedent executed a document
titled “First Amendment to Trust” (amendment) in his capacity as trustor.
As relevant here, the amendment sought to strike section 7.2.1 — which
would have distributed the property amongst Julia, Sal, and Christina upon
the decedent’s death — and states the property “shall remain in the trust.”
Mary and the decedent signed the amendment and “[a]ccepted and adopted”
it as co-trustees. The amendment is not notarized. The decedent died the
next day.
Mary thereafter petitioned to construe the Trust and for an order
confirming the validity of the amendment. Mary acknowledged the Trust
imposed a notary requirement but argued the amendment was effective
notwithstanding the “lack of notarization” because section 5.2.4 did not
delineate an exclusive amendment procedure. Thus — according to Mary —
the Trust could be amended using the revocation procedure described in
section 15401, subdivision (a)(2). Mary also posited that “a notary public’s
acknowledgement may serve a useful purpose when a trust settlor delivers a
signed document to a third-party trustee,” but it serves “no purpose” when
the trustors and trustees “are the same people.” 2
Sal responded to Mary’s petition and filed a petition of his own, to
invalidate the amendment. He asserted the decedent “allegedly executed”
the amendment, which was prepared by Mary, and that the amendment was
2In her opening brief, Mary argues “[t]here is no dispute” the
“signatures on [the amendment] . . . are authentic.” At oral argument,
however, Sal’s counsel indicated a dispute had been raised below; Sal also
uses the term “alleged” when describing the decedent’s signatures on the
amendment.
3
void as it was not executed by the “[d]ecedent in the manner and form
required” by the Trust and section 15402. Sal also maintained the
amendment was void for the additional reason that the decedent was
delusional in the days preceding his death, and that Mary exerted undue
influence on the decedent with the intent to undermine his “testamentary
wishes as delineated” in the Trust. Mary objected to Sal’s petition.
At the parties’ request, the probate court decided the validity of the
amendment before reaching other issues in the parties’ petitions. Relying on
section 15402 and case law interpreting that statute, the court concluded the
amendment was “null and void” because the decedent’s “signature was not
acknowledged by a notary public as required under [s]ection 5.2.4” of the
Trust. The court denied Mary’s petition to construe the Trust and to confirm
the validity of the amendment.
DISCUSSION
The de novo standard of review “applies to questions of statutory
construction [citation] and to the interpretation of written instruments,
including a trust instrument, unless the interpretation depends on the
competence or credibility of extrinsic evidence or a conflict in that
evidence.” (Pena v. Dey (2019) 39 Cal.App.5th 546, 551 (Pena); Burch v.
George (1994) 7 Cal.4th 246, 254.) “The paramount rule in construing [a
trust] . . . instrument is to determine intent from the instrument itself and
in accordance with applicable law.” (Brown v. Labow (2007) 157 Cal.App.4th
795, 812.)
The Probate Code governs trust revocation and modification. Section
15401, subdivision (a) sets out two alternative methods for the revocation of
a trust. Under the first method, a trust may be revoked by “compliance with
any method of revocation provided in the trust instrument.” (§ 15401,
4
subd. (a)(1).) Under the second method, a trust may be revoked in “a writing,
other than a will, signed by the settlor . . . and delivered to the trustee during
the lifetime of the settlor.”3 (Id., subd. (a)(2).) But, if “the trust instrument
explicitly makes the method of revocation provided in the trust instrument
the exclusive method of revocation,” that method must be used. (Ibid.; Pena,
supra, 39 Cal.App.5th at pp. 551, 552.) To do so, the trust must contain “an
explicit statement that the trust’s revocation method is exclusive.” (Cundall
v. Mitchell-Clyde (2020) 51 Cal.App.5th 571, 581, 584.) Thus, “section 15401,
subdivision (a)(2) ‘provides a default method of revocation where the trust is
silent on revocation or does not explicitly provide the exclusive method.’ ” (Id.
at p. 587, italics omitted.)
Section 15402, by contrast, governs modification of a trust. It states:
“[u]nless the trust instrument provides otherwise, if a trust is revocable by the
settlor, the settlor may modify the trust by the procedure for revocation.”
(§ 15402, italics added.) Under section 15402, when “the trust instrument is
silent on modification, the trust may be modified in the same manner in
which it could be revoked, either statutorily or as provided in the trust
instrument.” (King v. Lynch (2012) 204 Cal.App.4th 1186, 1192 (King).)
When the trust instrument “specifies how the trust is to be modified,”
however, that “method must be used to amend the trust.” (Id. at pp. 1192,
italics added, 1193.) Section 15402 “ ‘recognizes a trustor may bind himself
or herself to a specific method of . . . amendment of a trust by including that
specific method in the trust agreement.’ ” (King, at p. 1193.)
3 Section 15401, subdivision (b) imposes additional obligations with
respect to community property. (See Masry v. Masry (2008) 166 Cal.App.4th
738, 743.) The terms “trustor” and “settlor” are interchangeable and
synonymous. (See In re Marriage of Perry (1997) 58 Cal.App.4th 1104, 1109
& fn. 2.)
5
Thus, when a trust specifies an amendment procedure, a purported
amendment made in contravention of that procedure is invalid. (Pena, supra,
39 Cal.App.5th at p. 552 [unsigned handwritten interlineation was invalid
where trust provided “any amendment to the trust ‘shall be made by written
instrument signed by the settlor and delivered to the trustee’ ”]; King, supra,
204 Cal.App.4th at p. 1194 [“to be effective,” the trust could be amended only
according to specified method]; Heaps v. Heaps (2004) 124 Cal.App.4th 286,
290–291, 294 [“under the literal terms of the trust,” trustors “had to write
a memo to themselves (or its substantive equivalent) to amend the trust”];
Crook v. Contreras (2002) 95 Cal.App.4th 1194, 1209 [where trust “expressly
deprived [the decedent] of the power to revoke, modify or amend,” documents
purporting to amend the trust were “invalid”]; Conservatorship of Irvine
(1995) 40 Cal.App.4th 1334, 1343–1345 [amendment that did not comply with
specified amendment procedure was “invalid”].)
Mary acknowledges section 15402 applies here. And, as she must,
Mary concedes the Trust requires that an amendment “shall” be notarized
and that the amendment here is not. But she argues it is of no moment,
asserting she and the decedent were free to ignore the amendment procedure
they included in the Trust in favor of the revocation procedure set forth in
section 15401, subdivision (a)(2).
This argument was considered — and rejected — in King, supra,
204 Cal.App.4th 1186. There, a married couple’s revocable trust permitted
revocation by an instrument in writing signed by either settlor, and
modification as to community property by an instrument in writing signed by
both settlors. (Id. at pp. 1188–1189, 1194.) After one spouse was seriously
injured, the other spouse executed several amendments to the trust
pertaining to community property without the injured spouse’s signature.
6
(Id. at pp. 1189–1190.) The majority in King reasoned that the “trust
specified a modification method and thus, under section 15402 the trust could
only be amended in that manner. The settlors bound themselves to a specific
method of modification.” (Id. at p. 1194.) King held the purported
amendments were invalid because they did not comply with the modification
procedure described in the trust. (Ibid.)
In urging King to conclude otherwise, the appellant argued the trust
could be modified using the statutory revocation procedure “because the trust
did not explicitly make the method of modification exclusive.” (King, supra,
204 Cal.App.4th at p. 1192.) The King majority disagreed. It held that when
“the Legislature enacted sections 15401 and 15402, it differentiated between
trust revocations and modifications. This indicates that the Legislature no
longer intended the same rules to apply to both revocation and modification.
[¶] If we were to adopt appellant’s position and hold that a trust may be
modified by the revocation procedures set forth in section 15401 unless the
trust explicitly provides that the stated modification method is exclusive,
section 15402 would become surplusage. Rather than enacting section 15402,
the Legislature could have combined revocation and modification into one
statute. Moreover, as is evident from section 15401, the Legislature knew
how to limit the exclusivity of a revocation method provided in a trust and
chose not to impose such a limitation on modifications in section 15402.” (Id.
at p. 1193, fn. omitted.)
We concur. As King correctly reasoned, section 15402’s “qualification
‘[u]nless the trust instrument provides otherwise’ indicates that if any
modification method is specified in the trust, that method must be used to
amend the trust.” (King, supra, 204 Cal.App.4th at p. 1193, italics added.)
Here, the Trust requires an amendment to be notarized. By including that
7
“ ‘specific method of . . . amendment’ ” in the Trust, Mary and the decedent
expressed an intent to bind themselves to that method — indeed, a method
they had repeatedly utilized in amending and revoking prior trusts — and
they were not entitled to cast aside that procedure and amend the Trust
using the revocation procedure set forth in section 15401, subdivision (a)(2).
(King, at p. 1193.)
Mary insists King is distinguishable because the revocation and
modification procedures in the trust at issue in that case differed, whereas
the revocation and modification procedures here are identical. To support
this argument, Mary points to the last sentence of King, where the court
noted “the amendment provision [was] more restrictive than the revocation
provision,” and that a contrary holding — e.g., that the amendments were
effective — “would cause the amendment provision to become superfluous
and would thereby thwart the settlors’ intent.” (King, supra, 204 Cal.App.4th
at p. 1194, fn. omitted.) Relying on this sentence, Mary urges us to limit
King to situations where a trust imposes different procedural requirements
for revocation and modification. We decline the invitation for several
reasons.
First, like King, the Trust did set forth different procedures for the
revocation and amendment of trust provisions regarding community
property. As both counsel acknowledged at oral argument, under sections
5.2.1 and 5.2.4, either trustor could revoke provisions regarding community
property by acknowledged written instrument, but modification of provisions
regarding community property required both trustors executing an
acknowledged written instrument. Second, Mary’s interpretation is belied by
the plain language of section 15402. Had the Legislature intended for section
15402 to require an explicit statement of exclusivity for modification
8
procedures, it could have so stated, as it did in section 15401. (King, supra,
204 Cal.App.4th at p. 1193, fn. 3 [noting Legislature used “different statutory
language” in section 15402].) Or it elsewise could have omitted the qualifying
phrase, “[u]nless the trust instrument provides otherwise,” from section
15402. It did neither. “We cannot ‘ “rewrite a statute, either by inserting or
omitting language, to make it conform to a presumed intent that is not
expressed.” ’ ” (Cahill Construction Co., Inc. v. Superior Court (2021)
66 Cal.App.5th 777, 787.)
We acknowledge that Haggerty v. Thornton (2021) 68 Cal.App.5th
1003, review granted December 22, 2021, S271483 (Haggerty) — which was
decided while this appeal was pending — reached a different result.4 There,
a reservation of rights provision provided that the settlor “ ‘may’ ” amend or
revoke the trust “ ‘by an acknowledged instrument in writing.’ ” (Id. at
p. 1006.) The settlor drafted and signed an amendment but did not have the
amendment notarized. (Ibid.) The settlor’s niece argued the “amendment
was invalid because it was not ‘acknowledged’ as described in the trust
agreement.” (Ibid.)
The Haggerty court disagreed. It concluded the settlor could amend the
trust pursuant to the revocation procedure set forth in section 15401.
(Haggerty, supra, 68 Cal.App.5th at p. 1012, rev. granted.) Haggerty
4Our high court granted review on the following issue: “Can a trust be
modified according to the statutory procedures for revocation of a trust (Prob.
Code, § 15401) if the trust instrument itself sets forth identical procedures for
modification and revocation?” Haggerty may be cited for “persuasive value,”
and “for the limited purpose of establishing the existence of a conflict in
authority that would in turn allow trial courts to exercise discretion under
Auto Equity Sales, Inc. v. Superior Court (1962) 57 Cal.2d 450, 456, to choose
between sides of any such conflict.” (Haggerty v. Thornton, S271483,
Supreme Ct. Mins., Dec. 22, 2021; see also Cal. Rules of Court, rule 8.115(e)
& Advisory Com. com.)
9
reasoned that because “the trust does not distinguish between revocation and
modification, it does not ‘provide otherwise’ than the general rule, and under
section 15402 the trust may be modified by any valid method of revocation.
Moreover, as a reservation of rights, it does not appear [the settlor] intended
to bind herself to the specific method described in the trust agreement, to the
exclusion of other permissible methods. Because the method of revocation
and modification described in the trust agreement is not explicitly exclusive
(and no party argues otherwise), the statutory method of revocation was
available under section 15401. [Citation.] [The settlor] complied with the
statutory method by signing the . . . amendment and delivering it to herself
as trustee. It was therefore a valid modification of the trust agreement.”
(Ibid.)
Relying on the King dissent, Haggerty added that “[s]ection 15402
cannot be read in a vacuum. It does not establish an independent rule
regarding modification. It recognizes the existing principle that ‘a power of
revocation implies the power of modification.’ [Citation.] The method of
modification is therefore the same as the method of revocation, ‘[u]nless the
trust instrument provides otherwise,’ i.e., unless the trust instrument
distinguishes between revocation and modification. [Citation.] The
California Law Revision Commission made this point explicit: ‘ “Under
general principles the settlor, or other person holding the power to revoke,
may modify as well as terminate a revocable trust. [Fn. omitted.] The
proposed law codifies this rule and also makes clear that the method of
modification is the same as the method of termination, barring a contrary
provision in the trust.” ’ [Citations.] Under this interpretation, section 15402
is not mere surplusage . . . . As the California Law Revision Commission’s
comment explains, it codifies the existing rule that the power of revocation
10
includes the power of modification, thus an available method of revocation is
also an available method of modification—unless the trust instrument
provides otherwise.” (Haggerty, supra, 68 Cal.App.5th at p. 1011, rev.
granted, citing King, supra, 204 Cal.App.4th 1196 (dis. opn. of Detjen, J.).)
While we have no quarrel with the general sentiment expressed in
Haggerty (and other cases) that the power to revoke a trust implies the power
to modify it, we disagree with Haggerty’s conclusion that the phrase “[u]nless
the trust instrument provides otherwise” in section 15402 means that unless
the trust instrument explicitly states that the provided for method of
amendment is exclusive, the statutory method of revocation may be used to
modify. (Haggerty, supra, 68 Cal.App.5th at p. 1011, rev. granted.) The most
plain and straightforward reading of the qualifying phrase, “[u]nless the
trust . . . provides otherwise,” in section 15402 is that when a trust provides
for the use of a specific modification method, that method must be used.
(King, supra, 204 Cal.App.4th at p. 1193; Rest.2d, Trusts, § 331, com. d
[“Where method of modification specified. If the settlor reserves a power to
modify the trust only in a particular manner or under particular
circumstances, [settlor] can modify the trust only in that manner or under
those circumstances.”].)5
In light of our conclusion, Mary’s exposition on the legislative history of
sections 15401 and 15402 is unavailing. Mary has not persuasively argued
5 The concurring opinion agrees the Trust “provides otherwise” within
the meaning of section 15402; it reasons that the use of the word “shall”
sufficiently specifies “an exclusive method of modification.” (Conc. opn. of
Tucher, P.J., pp. 1, 3.) In our view, it is enough for a trust to specify a
procedure for modification — irrespective of whether it uses the words “may,”
“shall,” or something else. In so doing, the trust has provided for a procedure
other than the Legislature’s fallback method (i.e., the revocation procedures
in the trust and section 15401). (King, supra, 204 Cal.App.4th at p. 1193.) In
11
either statute is ambiguous, and it is well settled that in the absence of
ambiguity, the plain meaning of the statutory language governs. (Fairbanks
v. Superior Court (2009) 46 Cal.4th 56, 61.) Moreover, having reviewed the
legislative history surrounding the enactment of sections 15401 and 15402,
including the Law Revision Commission’s 1986 report regarding the
legislative changes, we find nothing inconsistent with our construction of
section 15402.
“Sections 15401 and 15402 were enacted in 1986 and became operative
in 1987.” (King, supra, 204 Cal.App.4th at p. 1191.) Before that date, trust
revocation was governed by a provision of the Civil Code, but “no statute
specifically addressed trust modifications. Rather, courts held that, in
general, a power of revocation implied the power of modification” and
“applied the rules governing trust revocations to trust modifications.” (King,
at pp. 1191, 1193.) To clarify the law of trusts, the California Law Revision
Commission recommended reorganizing and consolidating “the scattered
provisions of existing law.” (See Recommendation Proposing the Trust Law
(Sept. 1986) 18 Cal. Law Revision Com. Rep. (1986) pp. 1201, 1205, 1222.)
In response to the Law Revision Commission’s recommendation, the
Legislature enacted Assembly Bill No. 2652 (1985–1986 Reg. Sess.), the bill
that created sections 15401 and 15402. The Legislative Counsel’s summary
digest explained, as relevant here, that the bill “would provide that . . . a
trust is revocable by the settlor, in whole or in part, by compliance with any
method of revocation provided in the trust instrument or by a writing (other
other words, the outcome should not turn on a trust’s use of supposedly
“mandatory” or “permissive” language. Sometimes language that appears
mandatory is not; other times, of course, language that appears permissive is
mandatory. (E.g., Kropp v. Sterling Sav. & Loan Assn. (1970) 9 Cal.App.3d
1033, 1043–1044 [concluding “may” in the trust at issue was mandatory
rather than permissive].)
12
than a will) signed by the settlor . . . . It would also allow the modification of
the trust, unless the instrument provides otherwise, by the same revised
procedure for revocation if the trust is revocable by the settlor.” (Legis.
Counsel’s Dig., Assem. Bill No. 2652 (1985–1986 Reg. Sess.) as amended Mar.
31, 1986, Summary Dig., p. 3, italics added; People v. Superior Court (Lavi)
(1993) 4 Cal.4th 1164, 1178 [Legislative Counsel’s Digest is indicative of
legislative intent].) The Law Revision Commission’s 1986 report similarly
summarized the proposed legislation: “Under general principles the settlor,
or other person holding the power to revoke, may modify as well as terminate
a revocable trust. The proposed law codifies this rule and also makes clear
that the method of modification is the same as the method of termination,
barring a contrary provision in the trust.” (Recommendation Proposing the
Trust Law, 18 Cal. Law Revision Com. Rep., supra, at p. 1271, fn. omitted
& italics added.)
Taken together, this legislative history does not conclusively resolve
what was intended by the phrase, “[u]nless . . . provides otherwise” in section
15402. Haggerty would read that phrase as incorporating a requirement —
an explicit statement of exclusivity — that appears in section 15401, but
nowhere in section 15402. Also relevant to the Haggerty court is whether the
provided for procedures for amendment and revocation differ or are the same,
and whether the procedures are exclusive or permissive. Like King, we
conclude the simpler construction of section 15402’s text is preferable,
13
especially because it does not infer requirements that do not appear in the
statutory language.6
Mary contends that by jointly executing the amendment, she and the
decedent expressed their intent to change the disposition of the property, and
she urges us to give effect to the intent expressed in the amendment. But we
cannot view the amendment in isolation. While an appellate court “must
construe a trust instrument, where possible, to give effect to the intent of the
settlor, that intent ‘must be ascertained from the whole of the trust
instrument, not just separate parts of it.’ ” (Pena, supra, 39 Cal.App.5th at
p. 555; Heaps v. Heaps, supra, 124 Cal.App.4th at pp. 290–291.) The intent
expressed in the Trust, “stated explicitly in its amendment provision, is that
a written instrument must be [acknowledged by a notary public] . . . in order
to constitute a valid amendment.” (Pena, at p. 555.) Because the amendment
is not notarized, it is ineffective. (Ibid.)
In sum, we hold that when a trust specifies a method of amendment,
under section 15402, that method must be followed for the amendment to be
effective.
6 We do not find relevant or persuasive Mary’s citations to cases
construing section 15401 and to a predecessor statute that is silent on
modification. (Cundall v. Mitchell-Clyde, supra, 51 Cal.App.5th at p. 587 [the
“validity of a purported trust modification . . . is subject to a different
statutory analysis” than revocation].) Mary also characterizes the notary
requirement as a mere “procedural formality” that she and the decedent had
the power “to waive when they drafted and executed” the amendment. “The
argument is forfeited because [Mary] failed to raise it below.” (Blizzard
Energy, Inc. v. Schaefers (2021) 71 Cal.App.5th 832, 854; Ehrlich v. City of
Culver City (1996) 12 Cal.4th 854, 865, fn. 4 [argument not raised below is
“not cognizable”].) In the lower court, Mary argued the notary requirement
served no purpose, but she did not assert — as she does here —that she and
the decedent were “free to waive” the requirement.
14
DISPOSITION
The orders dated January 8 and February 9, 2021 are affirmed. Sal is
awarded costs on appeal. (Cal. Rules of Court, rule 8.278(a)(2).)
15
_________________________
Rodríguez, J.
I CONCUR:
_________________________
Fujisaki, J.
A162222
16
TUCHER, P.J., Concurring:
Like the majority, I would affirm on the basis that this trust
instrument requires an amendment to be notarized, and the amendment here
was not. (Maj. opn. ante, at p. 14.) The trust instrument sets forth the
exclusive method for modifying the trust because it requires that “[a]ny
amendment, revocation, or termination . . . shall be made by written
instrument signed, with signature acknowledged by notary public, by the
trustor(s) making the revocation, amendment, or termination, and delivered
to the trustee.” (Italics added.) Because the proffered amendment was not
acknowledged by a notary, it is not valid.
Nothing in Probate Code section 15401 or 15402 requires a different
result. Under Probate Code section 15402, “[u]nless the trust instrument
provides otherwise,” the settlor of a revocable trust “may modify the trust by
the procedure for revocation.”1 One procedure for revocation is set forth in
section 15401, subdivision (a)(2) (the statutory revocation procedure), but
that option was not available to the trustors here because this “trust
instrument provides otherwise.” (Ibid.) That is, the trust agreement sets
forth a different procedure for amending the trust, and it does so in language
that makes the specified method exclusive. That the trust agreement does
not expressly state its method is exclusive is of no moment, as the
requirement for express exclusivity appears only in section 15401,
subdivision (a)(2), governing revocation.
Unlike the majority, I would stop there. I would not also decide that
the same result obtains when a trust instrument sets forth a method for
1 Unspecified statutory references are to the Probate Code. Section
15402 provides, in its entirety, “Unless the trust instrument provides
otherwise, if a trust is revocable by the settlor, the settlor may modify the
trust by the procedure for revocation.”
1
amending the trust in terms that are permissive, rather than mandatory.
That issue is not presented by the facts of our case, and I’m not persuaded
that the majority’s resolution of it is correct.
My reservations arise primarily from what seems to me the most
natural reading of the statutory phrase “[u]nless the trust instrument
provides otherwise.” (§ 15402.) This phrase qualifies the provision that
immediately follows it, that the settlor of a revocable trust “may modify the
trust by the procedure for revocation.” (§ 15402.) I read this sentence to
mean that the settlor may modify the trust using any appropriate procedure
for revocation “[u]nless the trust instrument” says that the settlor may not
(i.e., “provides otherwise”). (§ 15402.) I can think of three ways a trust
instrument could exclude use of the procedures for revocation. First, the
trust instrument could state that no modification of the trust is allowed.
Second, it could state, as the instrument before us does, that modification is
allowed only if some other specific procedure is followed. And third, it could
allow modification using permissive language but state that procedure(s) for
revocation may not be used. If the trust does none of these things, then I
don’t see how it has “provide[d] otherwise.” In particular, if a trust
instrument sets forth a method for modification but does not explicitly or
implicitly limit trustors to the use of this method, I don’t think it has
sufficiently negated the statutory provision granting the settlor authority to
modify the trust using a procedure for revocation. In such circumstances (not
before us), it seems to me that the settlor remains free to modify the trust
using any procedure for revocation or any procedure for modification that the
trust sets forth in permissive, but not mandatory, language.
This construction of section 15402 is not the one adopted by the
majority in King v. Lynch (2012) 204 Cal.App.4th 1186, which concluded a
2
permissive, nonexclusive modification provision displaced the statutory
revocation procedure. Nor is it identical to the construction in Haggerty v.
Thornton (2021) 68 Cal.App.5th 1003, review granted December 22, 2021,
S271483, which held that any authorized method of revocation may be used
to modify the trust unless the trust instrument distinguishes between
revocation and modification. (Id. at pp. 1011–1012.)
The construction I suggest does, however, provide a measure of
continuity with case law that predates the adoption of section 15402. Under
prior law, there was a statutory procedure for revoking a trust similar to the
statutory procedure available today (compare former Civ. Code, § 2280 with
Prob. Code, § 15401, subd. (a)(2)), and case law allowed this statutory
revocation procedure also to effect a modification, on the theory “that the
right to revoke included an implied right to modify.” (Huscher v. Wells Fargo
Bank (2004) 121 Cal.App.4th 956, 962, fn. 5.) This was the principle that
section 15402 sought to codify. (Cal. Law Revision Com. com., West’s Ann.
Prob. Code (2021 ed.) foll. § 15402 [“This section codifies the general rule that
a power of revocation implies the power of modification”].) The Huscher
court, after analyzing cases decided under the earlier statute, derived from
those cases the rule that “a trust may be modified in the manner provided by
[the predecessor statute] unless the trust instructions either implicitly or
explicitly specify an exclusive method of modification.” (Huscher, at p. 968,
italics added.)
I am inclined toward a similar rule here: a trust may be modified by the
current statutory procedure for revocation “unless the trust instrument
provides otherwise” by implicitly or explicitly specifying an exclusive method
of modification (or by expressly taking off the table the option of modification
by a procedure for revocation). (§ 15402.) But my view here is provisional.
3
Because the facts of our case do not require us to decide between this rule
and the one the majority adopts, I would leave for another day resolution of
this point of difference. On the case before us, the majority and I completely
agree.
TUCHER, P. J.
4
Superior Court of San Francisco City and County, Hon. Ross C. Moody.
Hartog, Baer & Hand, Ryan J. Szczepanik and Kevin P. O’Brien, for Plaintiff
and Appellant.
Ragghianti Freitas, Paul B. Gruwell, for Defendant and Respondent.
5