Kote v. Carcich CA4/3 ( 2021 )

Filed 12/3/21 Kote v. Carcich CA4/3
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
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or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FOURTH APPELLATE DISTRICT
DIVISION THREE
PETER KOTE,
Plaintiff and Appellant, G059231
v. (Super. Ct. No. 30-2011-00495722)
ANNETTE HARRISON CARCICH, OPINION
Defendant and Respondent.
Appeal from orders of the Superior Court of Orange County, Jacki C.
Brown, Judge. Dismissed. Request for judicial notice denied.
Alchehayed Law and Ilian Alchehayed for Plaintiff and Appellant.
Murphy Austin Adams Schoenfeld and Bryan L. Phipps for Defendant and
Respondent.
Appellant Peter Kote appeals from the trial court’s suspension of his
powers as trustee of the Harrison Family Trust and appointment of respondent Annette
Harrison Carcich as interim successor trustee. We dismiss the appeal because an order
suspending a trustee in anticipation of a trial on removal is not an appealable order and,
having been suspended and lacking any other connection to the trust than his status as
suspended trustee, appellant lacks standing to appeal from the trial court’s order
appointing respondent as interim successor trustee.
FACTUAL AND PROCEDURAL HISTORY
Appellant is the trustee of the Harrison Family Trust. Respondent and
Mark Harrison are the two beneficiaries of the trust; Harrison is not a party to this appeal.
Litigation between the beneficiaries was resolved by way of a settlement
agreement reached at a mediation, in which the trustee did not participate. The settlement
agreement called for the trust’s assets to be distributed to the beneficiaries in particular
amounts, and in some cases in kind, after court approval of the settlement. After the
settlement was reached, respondent filed a motion to enforce the settlement, which the
trial court granted. In so doing, the court also specifically approved the settlement and
ordered appellant to distribute certain specified trust property within fifteen days of the
issuance of its order.
While appellant made various distributions during the 15-day period
provided by the order, at the end of the period respondent concluded she had not received
the full distribution ordered by the court. Respondent applied ex parte for (1) suspension
of appellant’s powers as trustee; (2) appointment of a temporary trustee; and (3) an order
for appellant to show cause why he should not be held in contempt for failure to comply
with the court’s order. Appellant opposed the ex parte application, arguing no exigent
circumstances existed and appellant had substantially complied with the order.
After several continuances, the trial court ultimately held a trial on
contempt, spanning four days. At the conclusion of respondent’s case for contempt,
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appellant’s counsel moved for judgment as a matter of law. The trial court granted the
motion, discharging the contempt allegations, but simultaneously granted respondent’s ex
parte application for suspension of appellant’s powers, finding appellant had not treated
the beneficiaries of the trust equally. After the court announced its ruling from the bench,
appellant’s counsel requested an opportunity to present his client’s case, but the trial
court denied his request, ruling that appellant had no right to an evidentiary hearing on an
ex parte application. Instead, the trial court directed the parties to file pleadings on
removal: one on respondent’s behalf requesting the suspension become a permanent
removal; and one on appellant’s behalf requesting not to be removed.
After a lengthy delay in proceedings caused by the outbreak of the COVID-
19 pandemic, and after the trial court received a declination to serve from the successor
trustee named by the trust document, the trial court appointed respondent interim
successor trustee. Appellant appealed from both the order suspending his powers as
trustee and the order appointing respondent interim successor trustee.
DISCUSSION
Respondent argues this appeal should be dismissed because the order
suspending appellant’s powers as trustee is not appealable and, having been suspended
and having no other connection to the trust, appellant lacks standing to appeal from the
order appointing respondent interim successor trustee. Appellant responds that the order
suspending appellant’s powers is appealable under Probate Code section 1300,
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subdivisions (c) and (g). Respondent is correct.
1. Appealability of the Order Suspending Appellant’s Powers as Trustee
Appeals in trust disputes are exclusively governed by Probate Code
sections 1300 and 1304. (Kalenian v. Insen (2014) 225 Cal.App.4th 569.) Probate Code
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We deny respondent’s request for judicial notice, as its contents (a minute order
denying appellant’s motion to lift the suspension due to the automatic stay arising from
this appeal) are not relevant to our determination of the issues before this Court.
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section 1300 allows an appeal from “the making of, or the refusal to make” an order
falling within any of various categories. (Prob. Code, § 1300.) The two categories raised
by appellant as potential bases for appealability are subdivisions (c) and (g). Subdivision
(c) allows appeals from orders “[a]uthorizing, instructing, or directing a fiduciary, or
approving or confirming the acts of a fiduciary,” while subdivision (g) allows appeals
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from orders “[s]urcharging, removing, or discharging a fiduciary.” Probate Code section
1304 also allows appeals from the “grant or denial” of, among other things not relevant
here, “[a]ny final order under Chapter 3 (commencing with Section 17200) of Part 5 of
Division 9 [of the Probate Code], except the following: [¶] (1) Compelling the trustee to
submit an account or report acts as trustee. [¶] (2) Accepting the resignation of the
trustee.”
Suspension of a trustee’s powers “pending a decision on a petition for
removal of a trustee” is authorized by Probate Code section 15642, subdivision (e). As
this description suggests, suspension of a trustee’s powers is a provisional remedy
designed to preserve the status quo and protect the beneficiaries of the trust pending a
hearing on removal of the trustee.
Suspension of a trustee’s powers is not “[a]uthorizing, instructing, or
directing a fiduciary, or approving or confirming the acts of a fiduciary.” Nor is
suspension of powers “[s]urcharging, removing, or discharging a fiduciary.” Finally, as a
provisional remedy, suspension of a trustee’s powers is not a “final order” under Probate
Code section 17200 or any other provision of the Probate Code. While past authority on
this question is limited, it is unanimous that this type of provisional suspension of a
trustee’s powers is not appealable. (See Schwartz v. Labow (2008) 164 Cal.App.4th 417,
426, fn. 4; Aviles v. Swearingen (2017) 16 Cal.App.5th 485, 492.)
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As used in the Probate Code, a “fiduciary” includes a trustee. (Prob. Code,
§ 39.)
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Appellant argues the suspension of his powers as trustee amount to a
removal because appellant’s suspension was indefinite. We acknowledge “that a probate
order’s appealability is determined not from its form, but from its legal effect,” and “[a]n
order is appealable, even if not mentioned in the Probate Code as appealable, if it has the
same effect as an order the Probate Code expressly makes appealable.” (Estate of
Miramontes-Najera (2004) 118 Cal.App.4th 750, 755.)
However, the suspension of appellant’s powers as trustee is not a removal
merely because it has no set expiration at the time of its issuance. Like other provisional
or emergency remedies, suspension of a trustee’s powers can be imposed on an ex parte
basis at the inception of an action, before a hearing date has been set. Just as here, the
absence of a hearing date on removal temporarily renders such suspensions indefinite.
Nevertheless, the suspension remains only a suspension, not a removal, and is not itself
appealable, but instead can only be reviewed on appeal from whatever appealable order
results from the proceedings including, but not limited to, an order of removal.
In this matter, the trial court was careful to order only suspension, not
removal, advising counsel, “I was very specific[.] I did not remove [appellant]; I only
suspended him.” The record also contains a petition filed by respondent seeking
removal of appellant as trustee, which remains to be ruled upon by the trial court.
Accordingly, the order suspending appellant’s powers as trustee is not appealable and we
are compelled to dismiss the appeal from that order.
2. Appellant’s Standing to Appeal from the Order Appointing Respondent
As discussed above, after suspending appellant’s powers as trustee, the trial
court appointed respondent the interim successor trustee. Appellant also appealed from
this separate order of appointment. However, respondent contends, as a separate ground
for dismissal, that appellant is not a “party aggrieved” by the order and therefore lacks
standing.
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Standing to appeal is controlled by Code of Civil Procedure, section 902.
“[S]ection 902 is a remedial statute, which should be ‘liberally construed,’ with ‘any
doubts resolved in favor of the right to appeal.’” (Ajida Technologies, Inc. v. Roos
Instruments, Inc. (2001) 87 Cal.App.4th 534, 540.) Only a “party aggrieved” may
appeal. “An aggrieved person, for this purpose, is one whose rights or interests are
injuriously affected by the decision in an immediate and substantial way, and not as a
nominal or remote consequence of the decision.” (In re K.C. (2011) 52 Cal.4th 231,
236.)
Specific to the trust context, a trustee can appeal from a judgment or order
that is detrimental to the trust (Estate of Casserley (2018) 22 Cal.App.5th 824, 832) or
that pertains to the trustee’s exercise of his or her duties (In re Welch’s Estate (1895)
106 Cal. 427, 429), but not from an order distributing trust property or determining to
whom distribution should be made. (Estate of Baird (1987) 196 Cal.App.3d 957, 964-
966.) Also, a trustee who is also a beneficiary may separately have standing to appeal
arising from rights or interests he or she holds as a beneficiary. (Estate of Hawkins
(1987) 194 Cal.App.3d 102, 105.)
Appellant is not a beneficiary of the trust. His powers as trustee are
presently suspended; he cannot exercise them regardless of the identity of his interim
replacement. Should he be reinstated as trustee, his return to that office will be
unaffected by the identity of its interim occupant. His only apparent present connection
to the trust is his status as a potential creditor, based on claims for trustee fees. The
choice of interim trustee has no immediate or substantial impact on his rights as a
creditor, and he is therefore not aggrieved. Because he is not aggrieved, he lacks
standing to appeal from the trial court’s order appointing respondent as interim successor
trustee, and his appeal of that order must be dismissed as well.
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DISPOSITION
The appeal is dismissed. Respondent shall recover costs on appeal.
ZELON, J.*
WE CONCUR:
BEDSWORTH, ACTING P. J.
MOORE, J.
*Retired Justice of the Court of Appeal, Second Appellate District, assigned by the Chief
Justice pursuant to article VI, section 6 of the California Constitution.
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