192 Cal. App. 4th 90
Cal. Ct. App.2011Background
- Megan Kucker and Bonnie Alexander, successor trustees of the Mona S. Berkowitz Trust, petitioned to confirm that shares of stock were trust assets under Probate Code § 850(a)(3)(B).
- Trustor Mona S. Berkowitz created a revocable inter vivos trust and executed a general assignment transferring all of her property to the Trust, plus a pour-over will.
- On October 29, 2009, the Trust was amended and restated, and an assignment transferred Trustor’s shares of 11 specified corporations and funds to the Trust, with successor trustees named for post-death administration.
- Trustor died in November 2009; in February 2010 the petition sought to confirm 3,017 Medco Health Solutions, Inc. shares as Trust assets; those shares were not described in the Oct. 29, 2009 stock assignment.
- The Medco shares were allegedly missing a stock certificate; appellants argued the General Assignment evidenced Trustor’s intent to transfer all stock, including the lost certificate shares, to the Trust.
- Probate court denied relief, relying on Civil Code § 1624(a)(7) and noting a potential oral trust under Probate Code § 15207, then concluded a writing describing the property was required for transfers over $100,000.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the General Assignment transferred Medco stock to the Trust | Trustor intended all stock, including the Medco shares, to be part of the Trust under the General Assignment. | General Assignment did not specifically describe or reference Medco shares; the transfer is ineffective. | General Assignment was effective to transfer Medco stock to the Trust. |
| Whether Civil Code § 1624(a)(7) applies to stock transfers to a trust | Statute cannot bar transfer of stock to a trust where a general assignment expresses broad transfer of personal property. | Section 1624(a)(7) governs agreements to loan or extend credit; it should be construed to apply to large stock transfers. | Section 1624(a)(7) cannot be applied to stock transfers to a trust; it is inapplicable here. |
Key Cases Cited
- Estate of Heggstad, 16 Cal.App.4th 943 (Cal. Ct. App. 1998) (recognizes that a trust can include transferred assets declared as held in trust, even without formal deeds)
- Ike v. Doolittle, 61 Cal.App.4th 51 (Cal. Ct. App. 1998) (applies de novo review and limits if no extrinsic evidence)
- Sterling v. Taylor, 40 Cal.4th 757 (Cal. 2007) (statute of frauds requires description to identify real property; stock transfers differ)
- King v. Stanley, 32 Cal.2d 584 (Cal. 1948) (statute of frauds principles referenced in transfer analysis)
- Patel v. Liebermensch, 45 Cal.4th 344 (Cal. 2008) (discussion of limitations and scope of equitable remedies and written descriptions)
- Estate of Gardner, 187 Cal.App.4th 543 (Cal. Ct. App. 2010) (establishes that delivery plus oral trust declarations can create a trust in certain contexts)
- Nielsen v. Gibson, 178 Cal.App.4th 318 (Cal. Ct. App. 2009) (appeal on judgment roll standard for absence of transcript; record-face-review)
- Araiza v. Younkin, 188 Cal.App.4th 1120 (Cal. Ct. App. 2010) (statutory interpretation of probate and trust provisions; de novo review context)
- Estate of Gardner, 187 Cal.App.4th 543 (Cal. Ct. App. 2010) (reiterates standards for establishing oral trusts of personal property)