*1 Dist., G034707. Fourth Div. Three. Oct. 2006.] [No. ESSLINGER, W. Plaintiff and v.
STEPHEN Respondent, CUMMINS, Trustee, etc., J. Defendant and Appellant. KENNETH *3 Counsel Fuller, Fuller;
Law Offices of G. G. Garrett & Heaton and Marjorie Marjorie Thomas B. Garrett for Defendant and Appellant.
Hart, Coldren, Coldren, Pentecost, & King Robert S. John H. Andrew C. Kienle and Irene L. Kiel for Plaintiff and Respondent.
Opinion
FYBEL, J.
Introduction Cummins, Kenneth (the J. as trustee of the Trustee), Trust Esslinger Family from a him court order to account appeals W. compelling *4 Esslinger remainder The (Stephen),1 Trustee beneficiary. argues Stephen, a remainder lacked beneficiary, court for an standing petition probate the Trustee to account. moved to dismiss the compelling Stephen the order contending is appeal, appealable.
We conclude the order is and hold a remainder appealable has beneficiary under Probate Code standing section petition court for an order probate trustee to account. Probate Code compelling a remainder gives information request from the trustee and to the court under petition for that information or a if the trustee fails to The court has discretion to unreasonably comply. grant case, such a In this did deny petition. not abuse its discretion in the Trustee to account We therefore ordering Stephen. deny the motion to dismiss and affirm. History
Facts and Procedural (the remainder Trust Stephen Esslinger Family settlor, Trust).2 is a of the trust Paul H. Stephen grandson Esslinger. 1 Stephen Esslinger by clarity, We refer to his first name for not out of disrespect. 2 by Esslinger The Trust was established as an inter vivos trust Paul H. and Marie M. A, Esslinger Esslinger in 1976. When Paul H. died in the Trust was divided into Trust trust, B, subsequently revocable and Trust an irrevocable trust. Trust A and Trust B were plans complicated; say, further divided. The distribution are it Trust’s somewhat is suffice beneficiary. undisputed, Stephen is a remainder
521 trust documents that the Trustee produce In June requested Stephen to the time of the request. for the from and account to him period an declined to him some information but Trustee Stephen provided one as a remainder he was not entitled to on the accounting ground beneficiary. under Probate Code
In filed August petition Stephen for the (b)(7), years through demanding accounting alleged of certain trust documents. petition and seeking production of the Trust and with complied is a remainder beneficiary Stephen for the years demanding Code section 16061 by previously has than sixty days 2004. The “More through alleged: petition these for an accounting. Despite since demand delivery elapsed demands, done Trustee.” The petition prayed was ever [the] for the from the Trustee to account to directing Stephen period for an order 15, 1997, the date the was filed. petition September in October 2004. The supplemental filed a supplemental for but adds a original is the same as essentially relief. of trust documents in the production prayer he had the Trustee alleged provided response petition, he entitled under the Probate all information to which with asserted The Trustee through for the 1998. including accountings years sent to all trust 2003 were covering years through accountings beneficiaries, In a response, including Stephen, August supplemental standing remainder lacked beneficiary, the Trustee asserted as a Stephen, *5 (a). Code seek an under Probate accounting the Trustee. he received from filed objections accountings Stephen the court were accountings requested asserted the incomplete, Stephen to direct the Trustee and disallow the accountings, requested for the years through “a true account” prepare court, stated, court At the hearing petition, “[t]he Stephen’s can order in accountings spite Code [Probate section] [Probate it.” A minute that requests in terms of any Code section] and file the Trustee to prepare entered required order November Trustee filed a notice 2003. The through formal accountings that minute order. from appeal
Discussion
I. The Order Directing Trusteе to Is Prepare Accountings
Appealable. moved to dismiss on the an order appeal ground directing trustee to account is not The order here is it because appealable. appealable decides, effect, that has a to an We therefore accounting. the motion to deny dismiss appeal.
An lies from order made the Probate appeal any Code. appealable by Proc., 904.1, trusts, (Code (a)(10).) Civ. subd. In the case of the Probate an to be taken from final order under Probate Code permits аppeal any section 17200 et with two identified in Probate Code section seq., exceptions, (a). One is an order the trustee to exception “[cjompelling submit an account (Prob. or acts as trustee.” (a)(1).) subd.
An order to account is it when or decides appealable expressly implicitly other issues that could be the of an order. subject appealable probate v. Presoto (Evangelho Cal.App.4th Cal.Rptr.2d [79 146] trust beneficiaries for an (Evangelho).) Evangelho, petitioned accounting, the trustee had diverted to a bank alleging trust funds joint tenancy she controlled. The ordered trustee to account for trust funds transactions the bank account. On the trustee’s involving appeal, the trust beneficiaries the order to account was not argued appealable. an order is not under Probate agreed granting accounting appealable “[ujntil Code section 1304 and is made and the explained entered, sustaining objections there is no approving order.” appealable (Evangelho, supra,
But in the next the court held the order was paragraph opinion, because “the issue is broader than the order of a mere appealable accounting” contention is that court’s order could not compel “[the trustee]’s *6 account because a account is an joint tenancy joint tenancy asset and distinct from the trust.” 67 (Evangelho, supra, Cal.App.4th separate the was order trustee to account compelling appealable asset, because it decided the account was a trust implicitly joint tenancy which could be the of an order. subject apрealable
523 Here, had the the determined necessarily court’s probate the An order existence determining or right accounting. power 1304, (Prob. under a trust is duty, §§ of power, appealable. 17200, the (a), (b)(2).) The court’s order compelling subd. subd. probate Trustee is therefore appealable. standing not decide the issue of argues the did probate
because, court ordered probate not give on its own motion. Section 17200 did accountings probate motion. The court’s to order its own jurisdiction accountings probate internal affairs relating under section 17200 hear matters jurisdiction “The authorize of a trust is invoked clear intent was to legislative petition. for filed aby court to hear and decide instructions probate any petition Irvine the internal affairs of a trust.” (Conservatorship trustee regarding of 587]; see also Estate (1995) 40 1342 Cal.App.4th Cal.Rptr.2d [47 (1993) 433].) Heggstad Cal.App.4th Cal.Rptr.2d 951 [20 We construe the court’s order in a manner it within our bringing probate of it. accounting. rather than outside for an jurisdiction, Stephen petitioned if court ordered the Trustee account. The order not effeсtively, probate We and we construe order as such. granted petition, expressly, Stephen’s decline consider the court’s oral comments suggesting on its own motion or use those comments to construe ordering accountings v. Lock Co. (Whyte (2002) the minute order Schlage entered. Cal.App.4th 277].) Cal.Rptr.2d [125 if the court’s order we would exercise Finally, were appealable, (Morehart v. our discretion to as a for writ of treat mandate. appeal County Santa Barbara (1994) 745-747 Cal.4th Cal.Rptr.2d [29 143]; Connell v. Court P.2d Superior 393-394 Cal.App.4th 231].) Cal.Rptr.2d [69
II. Had as a Rеmainder Under Stephen, Beneficiary, Standing (b)(7) to Petition Probate Code Section Subdivision the Trustee to Probate Court Order Compelling
Account. A. Probate Code Sections 16061 Subdivision standing
Did remainder have Stephen, beneficiary, granted court to the Trustee to account? Probate Code section 16061 *7 the information from the request Trustee. Probate Code 17200, (b)(7), under which Stephen brought his petition, granted him to seek an account standing after the Trustee denied his request.3
Probate Code section 17200 a trust grants beneficiary standing petition internal “conсerning (Prob. affairs the trust.” Code, (a).) subd. (b) § Subdivision of section 17200 defines “internal affairs of a trust” to include a proceeding the trustee to “[c]ompelling report (Id., information about the trust or account to the beneficiary.” § (b)(7).) subd. The beneficiary may the trustee to if “the trustee only has failed to submit a or account requested report within 60 after written days of the request and ... report account has been made within six months (Ibid.) preceding request.”
Probate Code section 24 defines of a trust to include “beneficiary” “a interest, who has person or future any prеsent vested or contingent.” Probate Code section 16061 states: “Except Section provided on reasonable request by beneficiary, trustee shall the benefi assets, with a ciary liabilities, information about the receipts, trust, trustee, disbursements of the the acts of the and the particulars relating to the administration of the interest, trust relevant beneficiary’s including terms of the trust.” A Law Revision Commission comment states, the trustee does not with the “[i]f reasonable comply request information be beneficiary, may sought petition pursuant 17200(b)(7).” Section (Cal. com., Law Revision Com. 54A West’s Ann. Prob. (1991 ed.) foll. We p. give Law Revision Commission (See HLC comments “substantial Ltd. v. Properties, Superior Court weight.” 35 Cal.4th 560].) 105 P.3d Cal.Rptr.3d [24 commented, The Law Revision Commission also who is “[a] not entitled to an annual account under Section 16062 be entitled to information or a particular account under this section.” (Cal. Law Revision com., Com. 54A West’s Ann. Prob. supra, foll. italics added.) We read account” to “particular mean beneficiary’s information and under Probate Code section 3 Stephen standing contends specified not issue because it is not in the appeal. notice of appeal grounds A notice of need- specify for appeal but is sufficient if it identifies Court, particular judgment (Cal. being appealed. 1(a)(2).) or order Rules of rule The Trustee’s appeal complied notice of with that rule. *8 broad be as might narrow or be might A (b)(7). particular
subdivision court on the relief for a full year, depending an accounting with is consistent reading circumstances. This under the considers appropriate and orders any to “make exercise its discretion to court’s power the probate of the matters presented to necessary proper dispose other action take any Code, 17206.) (Prob. by petition.” beneficiary may a remainder
Thus, Code section under Probate not trustee does If the the trustee for information. make written request and no after that request, within 60 days with a reasonable comply months preceding within the six had been made or account beneficiary may petition remainder then a beneficiary’s request, remainder (b)(7), to compel Code section the court under Probate account. the trust or to information about trustee to report made a written request the Trust. He beneficiary is a remainder documents, information, accountings. and the Trustee to produce no account and of the written days request, within 60 Trustee did respond Thus, request. months Stephen’s made within the six preceding had been under Probate Code section had standing the Trustee for an order compelling court petition Code section 16061. account under Probate sections 16061 renders Probate Code
Our interpretation Trusts, with the Restatement Seсond (b)(7) consistent a court petition a remainder beneficiary’s which recognizes benefi- 172 states: “The c to section to account. Comment trustee compel to render to proper the trustee a by ciary may proper proceeding [,] In States many the trust. administration of an account of the to the intervals designated proper their accounts at . . . must submit trustees in statute by regulated The matter of for its approval. States, not only by to account bemay The trustee compelled many [f] also but of income or prinсipal, entitled beneficiary payment presently receive income or principal be entitled to will be or may who c, Trusts, com. (Rest.2d the future.” Sections 16061 B. Probate Code with Section Subdivision Harmonized the probate have standing did not argues Stephen The Trustee aas only 17200 serves Probate Code because court for vehicle for enforcing substantive created procedural beneficiary’s rights elsewhere in the Probate Code. the Trustee Probate Code particular, argues on a duty trustee to account to a remаinder imposes and, therefore, beneficiary, a remainder lacks standing to *9 17200, the to order an under section subdivision accounting (b)(7). 16062, Probate Code (a) section subdivision states: as other “Except 16064, wise in this and in Section the section trustee shall account provided trust, trustee, at annually, least the termination of the upon and change to each to whom income or in beneficiary is or authorized principal required the trustee’s discretion to be distributed.” Probate Code currently section states the 16064 trustee is not to or to a required information account provide account, (1) when: beneficiary the trust instrument the waives or report revoked, (2) (3) the trust the may be has waived in the beneficiary writing account, or to the the right and trustee are the same beneficiary person.
A remainder does not have a to an beneficiary under right accounting ante, Code section But Probate 16062.4 Probate Code section explained the gives 16061 remainder the beneficiary right to information from the If the the the trustee. trustee denies then remainder request, beneficiary 17200, the may under Probate Code section petition (b)(7) subdivision to the trustee to the information or for provide account. The Revision particular recognized, Law Commission benefi- “[a] who is not entitled an annual account Section be ciary to under 16062 may to entitled information or a (Cal. under particular [section 16061].” com., Code, 16061, supra, Law Revision Com. West’s 54A Ann. Prob. foil. § 52.) While an under section 16062 is information or p. accounting mandatory, 16061, account under by section under section sought petition 17200, (b)(7), subdivision lies within the court’s discretion. legislative history guidance Code section little provides Probate in determin 17200, ing standing (b)(7). beneficiary’s a remainder under Probate Code section subdivision 16062, 1986, (Stats. change Section continued former enacted in without section 40, 79, 820, 1990, 13, 2750) (Stats. 463). (See p. in repealed p. ch. ch. Law § § Cal. com, Code, 16062, supra, p. Revision Com. 54A Ann. Prob. foll. § West’s 53 [1990 enactment]; Notes, Code, 16062, supra, Statutory Historical and 54A West’s Ann. Prob. foll. § 16062, 54.) (a) accounting, p. requirement Former section subdivision added the of an annual com, (Cal. previously testamentary based a rule to Law applicable trusts. Revision Com. Code, 16062, supra, 53-54.) pp. chаnge 54A West’s Ann. Prob. foll. It also made a who § in accounting. testamentary gave right could an rule applicable demand The former to trusts trustee, 1138.1, (Former (a)(5), beneficiary, or remainderman.” Prob. subd. “[a] beneficiary’s right repealed Stats. ch. The remainder to demand accounting an from the not carried forward former section trustee was into subdivi However, (a). Legislature beneficiary’s sion fact revoked the remainder accounting to ask ability from the trustee mean the lost the does not remainder court to order the trustee to account. (b)(7) merely Probate subdivision suggests in Code
Nothing under Code duties creates a to enforce trustee’s procedure imposed in that fashion subdivision section 16062. Interpreting conclusion a beneficiary Law Revision Commission’s contrary with Probate compliance under enforce that section petition Legisla- also is contrary interpretation section 16061. Trustee’s (b)(7), intent, of section ture’s expressed language once months for an six which the beneficiary permits (a), Under section accounting. has since last expired often than annually, more the trustee is not required trust, of trustee. Because section change at the upon termination for an accounting allows the Legisla- before the trastee’s to account arises duty to be an enforcement mecha- ture could not have intended the former only *10 for nism the latter. 16062
The construction of Probate Code sections and Trustee’s her thus a to his or (b)(7) subdivision beneficiary’s ability protect impairs beneficiary— the any interest in the trust. Under Trustee’s interpretation, current, be able to receive an account- income beneficiaries—would including trust, trustee. a on a change once a on the termination of or ing only year, situations, court the theory probate in those three under the Trustee’s Except a be to to petition compel would current powerless grant beneficiary’s to urgently trustee to account—even if an were needed protect trust. addition, account duty Probate section states the trustee’s to Code 16062 1, the has been
does not to trusts created before unless trust July apply If Code section removed from Probate continuing jurisdiction. for (b)(7) impоsed enforcement mechanism duties solely then would to order section a court be powerless 1, 1987, a trust under remaining continuing created before and July jurisdiction. Code
A Law Revision Commission comment to Probate section states, to the to the trustee right limitations on of a beneficiary “[f]or (7), and account see Sections report paragraph com., 54A Ann. Prob. (Cal. Law Revision Com. West’s 16060-16064.” 194.) The Probate Code section supra, argues foll. Trustee described in the Law Revision Commission creates one such limitation on to account to а remainder the trustee duty comment by imposing ante, But, limit beneficia 16062 does not as discussed section beneficiary. Probate Code section accounting, for an and ry’s right petition remainder the grants to ask trustee for informa- tion. The limitations to which Law Revision Commission comment refers are found elsewhere within Probate sections Code 16060 through 16064. For section in contrast to section example, expressly limits the trustee’s to account duty by stating “trustee is not required information or account to a beneficiary” the four situations identified in the statute.
Probate Code trustee to places duty provide annual to income accountings beneficiaries. trustee does not have a However, duty remainder statutory beneficiaries. a remainder information beneficiary may from trustee under Probate Code request If the does not 16061. trustee with the reasonably request, comply remainder court under trustee information or a account if the trustee did do so within 60 voluntarily days after the beneficiary’s for information under section court has grant discretion and order the trustee to account tо the remainder beneficiary. 16061, 16062,
Our of the Probate Code sections interpretation harmonizes in a manner that a remainder benefi- protects interests without ciary’s imposing mandatory additional duties on the trustee. *11 ante, Further, this makes explained interpretation section Trusts, with the Restatement of consistent Second 172. Disposition
Conclusion a remainder As had the beneficiary, Stephen standing court probate pursuant the Trustee to information or a account under provide particular order,
Probate Code section In its it was stated specifically the its under section which court making grants probate trust, make the decisions internal affairs of a includ authority concerning the information trustee or to ing account ordering under read the determining section 16061. We the court’s order as probate for accounts which should receive were formal accounts particular 2003. The does years through Trustee not assert find abuse of and we ordering accountings, abused its discretion by formal order the Trustee court did not discretion. The probate in future. accounts trusteе to court order compelling
The November on to recover costs appeal. affirmed. Respondent Aronson, J., concurred. J., While
BEDSWORTH, P. I must dissent. Acting Dissenting. respectfully call, 16061 or that Probate Code section is a difficult I cannot agree this a remainder benefi (b)(7)1 permits Probate Code section accounting trust to for an annual of living ciary pre-July well-intentioned effort majority’s that he is denied under section 16062. at statutes that is odds reading fundamentally is based of applicable them. with my understanding account may concludes that a section 16061 majority on the relief the probate
include an full year, “accounting depending ante, (Maj. considers under the circumstances.” opn., appropriate that, effect, 525.) It then the trial court’s order as finding reads (formal account) needed to protect plaintiff annual statutory accounting interests, W. as one made and affirms the order Esslinger’s properly that under section 16061. I think misreads both scope decision below. annual I cannot a remainderman have agree accounting—yes. A broad guise particular accоunting. of a section 16061 But an annual his interests—yes, again. One as broad as needed to protect sched its under section with attendant statutorily-required mind, that is the Law (§§ 1060-1064.) To what my ules and detail. *12 when it says comment to section 16061 means Revision Commission “[a] account under Section 16062 entitled to an annual not is beneficiary who under this section.” account be entitled to information or particular may com., ed.) (1991 foll. Ann. Prob. Code Law 54A West’s (Cal. Revision Com. enactment], added.) italics 52p. [1990 To in this case. begin was ordered accounting Nor do I believe partiсular with, had alleged complied did not for one. The petition Stephen ask Stephen trustee, but what he a demand on the 16061 in making with section demanded, for, only available statutory accounting was a annual and sued
1 are to the Probate Code. All further references statutory 530
under section 16062. And that what the is trial court ordered. The issue aof raised, not account was particular evidence was offered as to what needed, information Stephen and no decision made to as what was interests, necessary to his all which would be for a protect section required 16061 So I petition. cannot that trial agree court acted under section 16061, nor that the ordered relief was within its power under that statute.
I must also take that exception majority’s suggestion section to order an annual that permits cannot accounting Here, be had under section my concern is the Law Revision Commis sion that comment states: “For limitations on the of a right beneficiary the trustee to account (7), or see report Sections paragraph com., (Cal. 15800 and 16060-16064.” Law Revision Com. 54A West’s Ann. Prob. foll. suрra, enactment].) p. [1990 read, the Law Reasonably Revision Commission comment means for a or of information report is limited accounting and A section 16061 rules: remainderman does not get (§ (a)), annual accounting subd. trustee of a trust pre-July is from the living exempted duty render (§ annual anyone (b)), subd. and a denied an annual (§ still have a accounting may 16061.) account. particular remainderman,
Since is a this is a living pre-July trust, he is not entitled to an annual under section 16062. As denied an annual he is entitled to a accounting, information that include a under section 16061. But whаt cannot have under section 16062—an annual accounting—he should be allowed to obtain under either section 16061 or section 17200. avoids the Law Revision majority Commission comment to section (b)(7) by reading the word “limitation” as referring only of sections portions 16064 that expressly say something such “ ” ante, ‘the trustee is not to’ a certain act. required perform (Maj. opn., 528.) I think are p. they wrong. narrow, “limitation,” is
Theirs of the word is reading there subjective is, nothing the comment or elsewhere to it A was intended. limit suggest all, bounds, restrains, confines,” after or and a “a “something limitation is (Webster’s restriction restraint from without.” 3d New Internat. imposed mind, Dict. my To reasonable only reading comment that sections and 16062 are restrictions or restraints on a *13 17200, (b)(7). under section subdivision beneficiary’s rights 17200, of section this construction rationale colleagues’ My 17200, 16061, sections is it subdivision that harmonizes to ability concerned that a beneficiary’s are also (b)(7). subdivision They to the right if he were denied his would be interests protect impaired 17200, I not (b)(7). do subdivision under section for an annual accounting either withstands analysis. believe point the section if one accepts is need to harmonize provisions
There to face It seems me comment at value. Law Revision Commission its strained only by where none exists creates majority inconsistency that comment, efforts to “remedy” exerts herculean then reading inconsistency. 17200, (b)(7) may that section subdivision
The also majority suggests of trust created trustee accounting by allow court to an annual 1, of language think that is prior My contrary plain 1987.1 16062, (b). subdivision 16062, (b) in section
The limitation trusts regarding pre-1987 view, it is one we must abide Legislature. my a choice represented of annual first with the adoption The account was by. requirement imposed 820, 40, 2750, (Stats. My ch. p. operative former section 16062. § 1, 1987, (b) 463.) Subdivision Stats. ch. repealed by p. rule did not to trusts existence inserted make it clear that new apply Com. (18 date rule. Cal. Law Revision Rep. on the new operative 673.2) change without former (1986) Current section continues p. Com. (See Code. Law Revision section 16062 of Cal. repealed supra, com., foll. 54A West’s Ann. Prob. p. [1990 enactment].) that annual seen fit Legislature having expressly to trusts created after My only
account requiremеnt prospectively applied retroactively. ill it should be suggest applied it behooves us now remainderman, the trustee of status as regard Without Stephen’s the annual account requirement instant trust from living exempt pre-1987 dissatisfaction with that (b). The majority’s under section be found in such an accounting may them result has convinced It has convinced me. (b)(7). not (b) states: “Subdivision comment to former section 16062 Law Revision Commission (a) apply by subdivision does accounting required makes clear that the annual any requirement for an account not affect date trusts. This section does pre-operative instrument, (18 law, statute, order.” Cal. trust or court prior pursuant to a exist under whether Rep. Revision Law Com. *14 view, the order my from should be reversed appealed because not entitled to an annual I would remand accounting. the matter with directions to consider the as one for relief under allow such further regard be proceedings proper.
A for a denied rehearing November and the opinion was modified to read as above. printed review the Appellant’s petition 17, 2007, Moreno, J., Court was denied Supreme S148651. January did not therein. participate