Estate of Sherman CA2/5 ( 2024 )

Filed 1/25/24 Estate of Sherman CA2/5
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 publication or ordered published, except as specified by rule
8.1115(b). This opinion has not been certified for publication or ordered published for
purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION FIVE
Estate of MARCIA SHERMAN,
Deceased. B323817
FRED BERGER, as Successor (Los Angeles County
Trustee, etc., Super. Ct. No. 19STPB10622)
Petitioner and Appellant,
v.
RANDI BERGER,
Objector and Respondent.
APPEAL from a judgment of the Superior Court of Los
Angeles County, Gus T. May, Judge. Affirmed.
Oldman, Sallus & Gold, Jamie N. Gonzalez, and Kevin W.
Yang for Petitioner and Appellant.
Steinhart Law Offices and Terran T. Steinhart for
Respondent.
This appeal concerns a brother’s petition to disinherit his
sister for allegedly violating the no contest clause of their
deceased mother’s trust. Fred Berger (Fred), as trustee of the
Marcia H. Sherman Family Trust (the Trust), filed a petition in
probate court asking the court to make certain orders related to
the Trust. Randi Berger (Randi), Fred’s sister, filed an objection
to the petition alleging that one of its primary allegations—that
the Trust had been validly established—was false because the
Trust agreement was the product of forgery or undue influence.
The probate court found Randi’s objection was a direct contest
but concluded the objection had been filed with probable cause
and thus did not violate the no contest clause. Fred appeals, and
we consider whether Randi had probable cause to file her
objection—focusing on Fred’s contentions that she lacked
probable cause because (a) the objection was untimely and (b) the
facts known to Randi when she filed her objection would not
cause a reasonable person to believe the Trust was created
through undue influence or forgery.
I. BACKGROUND
A. The Trust
Marcia Sherman (Marcia) established the Trust on October
19, 2018. The Trust identified Fred, Randi, and Julie Berger as
Marcia’s three children. It identified the estate held by the Trust
as all property held by or transferred to Marcia.
The Trust provides that upon Marcia’s death, the trustee is
to divide the estate into equal shares for Marcia’s three children.
The Trust appoints Marcia as the initial trustee, appoints Fred
as the successor trustee to serve upon her death, and appoints
Randi as the alternate trustee if Fred is unable to serve.
2
The Trust agreement includes a “No Contest” clause that
provides in pertinent part as follows: “If any . . . beneficiary
under this trust . . . in any manner, directly, or indirectly, and
without probable cause (i) contests or attacks this Trust or any of
its provisions, or seeks to impair or invalidate any of its
provisions . . . then in such event any share or interest in the
trust estate given to that contesting person under this Trust is
revoked . . . .” The no contest clause defines a “direct contest” as
“a pleading that alleges the invalidity of this instrument or one or
more of its terms” on certain enumerated grounds including
forgery and undue influence. The Trust agreement also defines
probable cause, stating it “exists if, at the time of filing of
a . . . Direct Contest . . . the facts known to the beneficiary would
cause a reasonable person to believe that there is a reasonable
likelihood that the relief requested in the action will be granted
after an opportunity for further investigation or discovery.”
Less than two weeks after the Trust’s creation, Marcia died
on October 27, 2018. On December 12, 2018, Fred served Randi
with a Probate Code section 16061.7 notice stating the Trust had
become irrevocable.1
B. Fred Files a Petition Regarding the Trust
In November 2019, Fred filed a petition in probate court
alleging Marcia had validly established the Trust and Fred
became the sole trustee upon her death. Fred also alleged Marcia
executed a pour over will concurrently with the Trust agreement
that directed her entire estate, other than her personal items, be
1
Statutory references that follow are to the Probate Code.
3
distributed to the Trust. Fred further alleged Marcia was a
beneficiary of the estate of her brother, Edward Sherman
(Edward), who predeceased her. (At the time of the filing,
Edward’s will was still in probate.)
Fred’s petition asked the court to issue an order
determining the Trust was executed on October 19, 2018, was in
existence as of the date of Marcia’s death, and remained in
existence as of the date of the petition. It also asked the court to
issue an order determining that Marcia’s inheritance from
Edward’s estate was an asset of the Trust.
C. Randi Files an Objection to Fred’s Petition
In July 2020, Randi filed an objection to Fred’s petition.
Randi’s objection asserted the Trust had not been validly
established because, even assuming Marcia’s signature on the
Trust was valid, her establishment of the Trust was the product
of Fred’s undue influence. Randi submitted six declarations in
support of her objections, including her own.
1. Facts averred in Randi’s declaration
Randi had been Marcia’s attorney in fact for financial
purposes pursuant to a power of attorney since 1995. Marcia
signed a durable power of attorney for health care purposes and a
new durable power of attorney for financial purposes naming
Randi as the primary attorney in fact in 2018.
Randi had been Marcia’s caregiver for 20 years and had
helped Marcia operate her legal practice for some time.2 Randi
2
Marcia needed a caregiver because of various injuries she
sustained over the years.
4
previously owned residences in Washington state and Tarzana,
California. She moved into Marcia’s Encino home in 2013,
following a fire at Randi’s California home. The following year,
Marcia began doing Randi’s bookkeeping in exchange for the
caregiving Randi was performing for Marcia. They shared
checking accounts and credit cards.
Marcia’s brother Edward died in December 2017. Attorney
Kira Masteller (Masteller) represented Marcia in matters related
to Edward, first in Marcia’s capacity as Edward’s attorney in fact,
and later in her capacity as executor of his estate. Edward’s
estate became embroiled in litigation, and Marcia was stressed
by dealing with Masteller and believed she was overbilling on the
case.
During the fall of 2018, Masteller sent Randi “trust
documentation” she prepared for Marcia to sign—without any
request to do so from Marcia—and asked Randi to obtain
Marcia’s signature on the documents. Marcia did not want
Masteller handling any legal proceedings for her and declined to
sign the documentation Masteller prepared. Marcia also explored
hiring a different attorney to replace Masteller in handling the
probate of Edward’s estate, but she found retainer deposits
desired by alternative counsel would be too costly.
In June 2018, Fred, who had almost no involvement with
the family for decades, approached Marcia and expressed a
willingness to help her. Fred stayed at Marcia’s house in early
July 2018, and from mid-September to early October of that year,
while Randi returned to Washington state. Shortly after Randi
returned to Los Angeles in October, Marcia was admitted to the
hospital. She was released on October 18, 2018, but she needed
to have some equipment installed at her home. Fred offered to
5
let Marcia stay with him while Randi had the equipment
installed.
Between October 18 and October 27, 2018, Randi tried to
reach Marcia by calling her cell phone but it was turned off.
When she called Fred, he said Marcia was asleep on all but one
occasion. Fred allowed Randi to visit Marcia at his home once.
During the visit, Marcia seemed extremely fatigued and was
slurring her words. A few days later, Fred told Randi he had
Marcia admitted to a hospital in Simi Valley. Randi wanted to
visit immediately, but Fred did not allow her to schedule a visit
until October 28. The day before the visit, Fred informed her
Marcia had died.
After Marcia’s death, Randi and her sister Julie learned
that on the second day Marcia was at Fred’s home, Marcia signed
a trust document prepared by Masteller naming Fred the trustee
of the Trust. Randi found numerous aspects of the Trust
documents suspicious, including the Trust’s identification of Julie
by her maiden name rather than her married name and the
absence of any provision in the Trust for Marcia’s beloved dogs.
Randi also found numerous actions Fred took in the days
before and after Marcia’s death suspicious. Fred closed all of
Marcia’s bank accounts, including the accounts shared with
Randi, the day before she died. Fred removed Marcia’s
answering machine and phone from her bedroom before she died.
Fred took possession of Marcia’s personal and business
documents, including the 2018 powers of attorney. Fred refused
to have an autopsy performed on Marcia’s body. Fred
intentionally or negligently sold Marcia’s house for $200,000-
300,000 below its market value, without properly marketing it.
Fred and Masteller fabricated reports about Randi during the
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administration of the Trust. And Fred sought to replace Randi as
the executor of Edward’s estate.
2. Other declarations
Five individuals who had known Marcia for many years
asserted Randi was very involved in her life. Two of those
individuals did not know Fred even existed prior to Marcia’s
death, and the other two observed he only had minor involvement
in Marcia’s life. Two of the declarants averred Marcia’s dogs
meant the world to her, and accordingly, they would have
expected her Trust to provide for the care of her dogs.
One of the declarants, Susan McCoy, stated she spoke to
Marcia on the phone in August 2018 and she sounded feeble,
fatigued, and mentally debilitated. Sarah Belgard said she called
Marcia several times during the last week of September 2018,
when Randi was in Washington and Fred was staying at Marcia’s
house, and each time Fred answered the phone and said Marcia
was unavailable.
Another declarant, Deanna Sherman (Deanna), was a
notary public who performed notary services for Marcia for about
six years and considered her a friend. She declared that, in
August 2018, Marcia asked Deanna to prepare and notarize a
durable power of attorney for health care purposes and a durable
power of attorney for financial purposes. Marcia stated she
wanted Randi to be her primary power of attorney on both forms,
her daughter Julie to be the secondary, and her son Fred to be
the tertiary. Deanna told Marcia it would be wiser to name Fred
the secondary because Julie would have difficulty exercising her
powers while living in London. Marcia responded that she was
reluctant to do so because she questioned Fred’s trustworthiness,
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but Marcia nevertheless accepted Deanna’s advice and named
Fred the secondary power of attorney. Around this time, Marcia
told Deanna that her attorney, Masteller, was not competently
representing her in matters involving Edward’s probate estate
and was overcharging her attorney fees.
Deanna further declared that on or around October 13,
2018, Fred contacted Deanna saying Marcia was back in the
hospital, had decided to remove Randi as her power of attorney,
and wanted to create a trust naming Fred the trustee. Deanna
was skeptical, said she needed to speak to Marcia, and offered to
immediately visit Marcia in the hospital to speak to her about the
requests. Fred seemed ill at ease and nervous; he said he would
talk to Marcia and have her contact Deanna—though Marcia
never did. Deanna did try to reach Marcia several times through
the end of October 2018 by calling both Marcia’s cell phone and
Fred’s phone number, but neither Marcia nor Fred answered or
replied to her voicemails. Deanna thought Marcia’s silence was
strange because she had never experienced difficulty contacting
her before. Deanna did not learn of Marcia’s death until she
contacted Randi in November 2018.
D. Fred’s Initial Response to Randi’s Objection and His
Subsequent Petition to Disinherit Her
Fred’s initial response to Randi’s objection contested
various factual representations supporting Randi’s undue
influence claim. Fred also asserted Randi lacked standing to
object because she brought her contest to the Trust more than
120 days after she was provided notice, on December 12, 2018,
that the Trust had become irrevocable.
8
As evidence in support of his response, Fred submitted
declarations by attorneys involved in the creation of Marcia’s
Trust. A declaration by attorney Kyla Parrino asserted Marcia
signed the Trust documents herself and did not appear to lack
capacity or to be acting under undue influence when she did so.
A declaration by Masteller asserted Marcia called her from the
hospital in October 2018 and asked her to prepare her estate plan
and to work with Fred to get it done. Masteller also declared that
Marcia told her she appointed Fred her power of attorney for
asset management and health care, and as executor and trustee
of her Trust, because her other local child, Randi, was very
difficult to work with. Masteller denied Fred gave her any
instructions regarding Marcia’s directions for her estate plan.
She also stated Fred, Randi, and Marcia were all emailed drafts
of Marcia’s estate plan.3
After filing his response to Randi’s objection, Fred also filed
a petition seeking an order determining Randi’s objection violated
the no contest clause of Marcia’s Trust. Fred contended Randi
lacked probable cause for her objection both because her objection
was untimely (he calculated the deadline to file a timely contest
as April 12, 2019) and because her forgery and undue influence
claims were unsupported and contradicted by facts Fred asserted.
Randi opposed Fred’s petition to disinherit her under the
Trust’s no-contest clause. She argued her objection to Fred’s
initial petition was not a contest to the Trust because it was a
defensive pleading filed in opposition to a petition, not a pleading
3
A later filing attached a copy of an email that Masteller
sent to Fred, Randi, and Marcia with the draft trust documents,
but it did not attach the draft trust documents themselves.
9
alleging the invalidity of the Trust. Randi also argued that if her
objection were a contest, she had probable cause to bring it.
E. The Trial Court’s Rulings
The trial court granted Fred’s initial petition asking the
court to determine the Trust was executed on October 19, 2018,
was in existence as of the date of Marcia’s death, remained in
existence as of the date of the petition, and included among its
assets Marcia’s inheritance from Edward’s estate. Overruling
Randi’s objection to the petition, the court found the objection
was time barred by Probate Code sections 16061.7 and 16061.8.
Fred’s separate petition to disinherit Randi for contesting
the Trust, however, was still pending, and the parties submitted
further briefing and evidentiary objections. The appellate record
indicates the probate court held a hearing on the petition to
disinherit Randi in May 2022, but Fred has not included a
reporter’s transcript of that hearing (or a substitute therefor) in
the record.
The probate court later issued a minute order
memorializing its ruling denying Fred’s petition to disinherit
Randi. The court found Randi’s objection to Fred’s initial petition
to determine the existence and assets of the Trust qualified as a
direct contest because the objection was brought to declare the
Trust invalid.
Turning to the question of whether Randi had probable
cause to bring her contest given that the 120-day period had long
since passed, the probate court concluded the issue of whether
Randi’s objection was barred by the 120-day rule was “more than
debatable,” at least in part because Randi filed an objection,
rather than a petition that would constitute an “action” to contest
10
the Trust under the relevant statute of limitations. The court
concluded Randi’s failure to anticipate the issue was not
sufficient to justify her disinheritance under the no contest
clause.
The probate court additionally concluded the facts
presented by Randi in connection with her objection could cause a
reasonable person to believe the Trust, created by Marcia nine
days before her death, was the product of undue influence. The
court reasoned that though all three of Marcia’s children received
an equal share of the Trust, Fred was entitled to both a fee and
control of the estate as trustee, a role he apparently coveted. The
court also found the evidence pointed to Fred having a virtually
non-existent role in Marcia’s life until shortly before she passed,
and thus, it was not unreasonable to infer that he feared he
might be disinherited or only left a small portion of the estate,
with a greater portion going to “his apparent nemesis,” Randi,
who spent a substantial time with Marcia during her lifetime.
II. DISCUSSION
Fred’s appeal of the probate court’s denial of his petition to
disinherit Randi is unmeritorious. Even assuming for
argument’s sake that Randi’s objection was a direct contest, the
probate court did not err in concluding the objection was not
brought without probable cause. As to timeliness, it is unclear
from the language of the pertinent Probate Code statute that the
120-day deadline applies to an objection filed in response to
another party’s petition, and the probate court was justified in
concluding a reasonable person could therefore have believed the
deadline would not apply. As to the merits of the question of
undue influence, the facts at Randi’s disposal when she filed the
11
objection are amply sufficient to establish the requisite
objectively reasonable likelihood the Trust had been procured by
undue influence.
A. Standard of Review
To the extent the probate court was required to make
underlying factual findings upon conflicting evidence in resolving
the petition, we review the record for substantial evidence to
support the findings on which the legal rulings were based. (In re
Estate of Fain (1999) 75 Cal.App.4th 973, 987-988.) “In the
absence of disputed facts, we review a court’s application of a no
contest clause de novo. [Citation.]” (Meiri v. Shamtoubi (2022)
81 Cal.App.5th 606, 614.) We interpret relevant portions of the
Probate Code de novo. (Jenkins v. Teegarden (2014) 230
Cal.App.4th 1128, 1138.)
B. Background Law
“The court’s interpretation of a no contest clause and
application of the clause to a proposed action is necessarily
informed by competing policy interests. On the one hand, ‘[s]uch
clauses promote the public policies of honoring the intent of the
donor and discouraging litigation by persons whose expectations
are frustrated by the donative scheme of the instrument.’
[Citation.] On the other hand, these interests are ‘[i]n tension
with . . . the policy interests of avoiding forfeitures and promoting
full access of the courts to all relevant information concerning the
validity and effect of a will, trust, or other instrument.’
[Citation.] ‘In light of these opposing interests, the common law
[and statutory law] in California recognized the enforceability of
no contest clauses, albeit strictly construed, “so long as the
12
condition was not prohibited by some law or opposed to public
policy.”’ [Citations.]” (Meiri, supra, 81 Cal.App.5th at 613.)
C. Randi’s Objection Did Not Violate the No Contest
Clause
By law and under the substantively identical terms of the
Trust, a party has probable cause to contest a trust if, at the time
the contest was filed, the party knew facts that “would cause a
reasonable person to believe that there [was] a reasonable
likelihood that the requested relief will be granted after an
opportunity for further investigation or discovery.” (§ 21311,
subd. (b).) “The term ‘reasonable likelihood’ has been interpreted
to mean more than merely possible, but less than ‘more probable
than not.’ [Citations.]” (Cal. Law Revision Com. com., Deering’s
Ann. Prob. Code (2022 ed.) foll. § 21311);4 see also People v.
Proctor (1992) 4 Cal.4th 499, 523.)
1. Probable cause and timeliness
“Section 16061.8 sets forth the applicable statute of
limitations for petitions that contest a trust.” (Bridgeman v.
Allen (2013) 219 Cal.App.4th 288, 293.) In pertinent part, the
statute provides that a person served with a section 16061.7
notification may not “bring an action” to contest the trust more
than 120 days from the date the notification by the trustee is
served. (§ 16061.8.) The relevant portion of the Probate Code
4
Though not binding, the comments of the California Law
Revision Commission are entitled to substantial weight in
construing a statute. (People v. Garfield (1985) 40 Cal.3d 192,
199.)
13
does not define what it means to “bring an action” to contest a
trust.5
In the absence of a specific definition, we consider the plain
meaning of the phrase “bring an action,” a phrase that our
Supreme Court recently analyzed in the context of interpreting
the Corporations Code. Our high court relied on common
definitions of the phrase: “Merriam-Webster defines to ‘bring’ as
‘to cause to exist or occur in any of a number of ways,’ including
to ‘institute’ ‘legal action’ or ‘complaint.’ [Citations.] Black’s Law
Dictionary likewise equates the phrase ‘bring an action’ with ‘[t]o
sue’ or to ‘institute legal proceedings.’ [Citations.]” (Turner v.
Victoria (2023) 15 Cal.5th 99, 114 [concluding the plaintiff
“‘sue[d],’ ‘institute[d] [a] legal proceeding[],’ and ‘cause[d]’ an
action ‘to exist’ by filing a petition in the probate court”].) On this
understanding of “bring an action,” it would be reasonable to read
section 16061.8’s limitations period as applying only to pleadings
that initiate legal proceedings, not to documents filed in an
already existing matter.
Though the probate court in this case found, for purposes of
ruling on Fred’s initial petition to determine the existence of the
Trust, that Randi’s objection was brought after the section
16061.8 120-day timeframe, that was not the obvious result
5
While Probate Code section 21310 provides a definition of
the term “contest,” that definition is limited to the “part” in which
section 21310 appears, namely, Part 3 of Division 7 of the
Probate Code. Because section 16061.8 appears in Part 4 of
Division 9 of the Probate Code, the section 21310 definition does
not apply.
14
looking just at the language of the statute that we have just
reviewed. A reasonable person could have accordingly believed
section 16061.8’s limitations period did not apply because Randi
did not “bring an action” merely by filing an objection.
Relying primarily on Meiri, supra, 81 Cal.App.5th 606,
Fred argues the untimeliness of Randi’s contest necessarily
means she lacked probable cause to bring it. That, however,
overreads the opinion. In Meiri, there was no question as to
whether section 16061.8’s statute of limitations applied because
the beneficiary in that case filed a petition to invalidate the trust
(among other things). (Id. at 611.) That, of course, is not true
here, and Meiri therefore is not inconsistent with our holding
that the date on which Randi filed her objection does not
establish she lacked probable cause.
2. Probable cause and undue influence
“Undue influence is pressure brought to bear directly on
the testamentary act, sufficient to overcome the testator’s free
will, amounting in effect to coercion destroying the testator’s free
agency.” (Rice v. Clark (2002) 28 Cal.4th 89, 96.) “Although a
person challenging the testamentary instrument ordinarily bears
the burden of proving undue influence [citation], . . . a
presumption of undue influence, shifting the burden of proof,
arises upon the challenger’s showing that (1) the person alleged
to have exerted undue influence had a confidential relationship
with the testator; (2) the person actively participated in procuring
the instrument’s preparation or execution; and (3) the person
would benefit unduly by the testamentary instrument.” (Id. at
96-97.)
15
Fred contends no reasonable person could believe Marcia
was subject to undue influence based on the facts available to
Randi when she filed her objection. Fred does not contest that he
and Marcia had a confidential relationship, but he argues there
was no evidence of active procurement or participation in
obtaining the Trust, nor evidence of undue benefit.
Active procurement “may be established by inference . . . .”
(Estate of Baker (1982) 131 Cal.App.3d 471, 481.) “[T]he one
using the undue influence [need not] be present in person at the
time of the execution of the document if the influence is present
to constrain the party from exercising his free will.” (Ibid.)
“‘“That the alleged wrongdoer had power or ability to control the
testamentary act may be established by a variety of
circumstances[ ]—such as control over the decedent’s business
affairs, dependency of the decedent upon the beneficiary for care
and attention, or domination on the part of the beneficiary and
subserviency on the part of the deceased.”’” (Ibid.) “The question
whether the proponent unduly profited by the will is resolved by
the terms of the will itself.” (Id. at 480-481.)
Taken together, the evidence proffered by Randi in her
declaration and the declarations from others would cause a
reasonable person to believe there was a reasonable likelihood
Randi would prevail on the undue influence claim. Marcia was
unwell and seemed feeble at the time. Fred had taken her into
his home and the evidence supports an inference that he isolated
her from her other family and friends. Marcia signed trust
documents prepared by an attorney she previously stated she did
not want to work with further, and aspects of the Trust seemed
inconsistent with Marcia’s previously stated practices or desires.
Additionally, though Fred did not “unduly” profit from the Trust
16
in the sense that his share of the estate exceeded that of Randi
and Julie, a reasonable person could nonetheless consider his
receipt of an equal portion an undue benefit given his limited
presence in Marcia’s life prior to the months leading up to her
death. So, too, could one consider his appointment as trustee, a
position that gave him both authority and compensation, as an
undue benefit under the circumstances.
Fred’s two counterarguments are both unpersuasive. Fred
contends Randi did not submit any evidence regarding Marcia’s
vulnerability at the time of execution of the Trust, but Randi
submitted evidence from which a reasonable person could draw
an inference that Marcia was weak and vulnerable in the days
surrounding the Trust’s creation. Fred also contends he did not
have any authority over Marcia when the Trust was drafted
because she was in the hospital, not alone with Fred. The
evidence Randi presented, however, would allow a reasonable
person to infer that Fred did have control over Marcia because he
limited Marcia’s ability to communicate with others when she
was under his care, including when she was in the hospital.
Additionally, Marcia signed the Trust after she was discharged
from the hospital and was staying at Fred’s home.
17
DISPOSITION
The probate court’s order is affirmed. Randi is awarded
costs on appeal.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
BAKER, J.
We concur:
RUBIN, P. J.
KIM, J.
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