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Dennis R.

Hower

California Supplement to Accompany

WILLS, TRUSTS, AND


ESTATE ADMINISTRATION
FOR THE PARALEGAL
Fifth Edition

Prepared by

George Yount

A u s t r a l i a C a n a d a M e x i c o S i n g a p o r e S p a i n U n i t e d K i n g d o m U n i t e d S t a t e s
CONTENTS

1 The Purpose and Need for a Will 1


2 The Concept of Property Related to Wills, Trusts, and Estate Administration 2
3 The Participants and the Proper Court 6
4 The Law of Succession: Death Testate or Intestate 12
5 Wills: Validity Requirements, Modification, Revocation, and Contests 19
6 Preparation to Draft a Will: Checklists and the Conference with the Client 23
7 Final Draft and Execution of a Valid Will 25
8 Introduction to Trusts 28
9 Classification of Trusts, the Living Trust, and Other Special Trusts 35
10 Estate Planning and Long-Term Care 37
11 Personal Representatives: Types, Pre-Probate Duties, and Appointment 38
12 Probate and Estate Administration 44
13 Informal Probate Administration 95
14 Tax Considerations in the Administration of Estates 101
15 Ethical Principles Relevant to Practicing Legal Assistants 103

In this supplement, a page reference follows each head(Hower 000). This page reference correlates with
Dennis Howers textbook, Wills, Trusts, and Estate Administration for the Paralegal, Fifth Edition.

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1 THE PURPOSE AND
NEED FOR A WILL

Statutory Requirements for a Will (Hower 2)


The statutes governing the requirements for, and validity of, wills in California are primarily
found in the California Probate Code (which will be abbreviated Prob in this supplement).

Basic Terminology Related to Wills (Hower 3)


The terminology found in the text is generally consistent with probate practice in California.
The court in California which has jurisdiction over probate matters (the probate court as de-
fined in the text) is the Superior Court. There is one Superior Court for each county in the State,
each with geographic jurisdiction over its county.
The use of the term heir in California relates to anyone who receives or would receive
any propertywhether real or personalthrough intestate succession (and not just those re-
ceiving real property, as defined in the text). It excludes surviving remarried ex-spouses. Prob
44, 21114.

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2 THE CONCEPT OF PROPERTY
RELATED TO WILLS,
TRUSTS, AND ESTATE
ADMINISTRATION

PROPERTY: TERMINOLOGY AND


CLASSIFICATION (HOWER 25)

Real Property (Hower 25)


The definition of real property in California is found in CC 658, et seq. and includes land, fix-
tures, appurtenances, and things growing upon the land, as well as airspace rights, solid min-
erals, and the right to drill for liquid minerals (gas, oil, and geothermal steam).

Fixtures (Hower 25)


Fixtures are defined in CC 660 and trade fixtures in CC 1019. Provisions regarding fixtures are
as explained in the text, generally. CC 1013, 1013.5.
In addition to the three tests identified in the text (annexation, adaptation, and intention),
California courts may also look to the relationship between the parties (certain parties being
generally favored over otherstenants over landlords, buyers over sellers, borrowers over
lendersthe grantor having presumptively greater knowledge of the property in question); or
the court may look to any agreement between the parties, since such agreements are binding
between the parties absent other mitigating factors. Oroville-Wyandotte Irr. Dist. v. Ford 47
Cal.App.2d 531 (1941).

Transfers of Real Property (Hower 27)


Acquisition of real property and the modes by which property may be acquired, are embod-
ied in CC 1000, et seq. Transfers of real property are addressed in CC 1039, et seq.

Personal Property (Hower 28)


Concepts regarding personal property in California are addressed in CC 946, et seq., and do
not differ from the discussion in the text.

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FORMS OF PROPERTY OWNERSHIP (HOWER 32)
Ownership of property and all of the rights in property by a single person is absolute owner-
ship. CC 679. When ownership is shared with another, or enjoyment of the property is delayed,
or its use is restricted, ownership is qualified. CC 680.

Tenancy in SeveraltyOwnership by One Person (Hower 34)


In California, ownership by a single person is designated as a sole or several ownership. CC 681.

Forms of Concurrent OwnershipOwnership by Two or More


Persons (Hower 34)
California statutory law does not provide for tenancy by the entirety. However, within the def-
inition of ownership by several persons, CC 682 includes joint tenancy, tenancy in common,
community property, and partnership interests.

Joint Tenancy (Hower 34)


Joint tenancy interests and their creation are set forth in CC 683, et seq., and do not differ from
the discussion in the text.

Tenancy in Common (Hower 44)


All co-ownership not otherwise defined in the grant as community, partnership, or joint ten-
ancy property in California is held as tenancy in common. CC 686.

Community Property (Hower 51)


As noted in the text, California is a community property state. Any property acquired by a per-
son while married, if not otherwise separate property, is community property (CC 687; Fam
760; Prob 28(a)) and the spouses share equally in community property. Fam 751.
Separate property is property owned prior to marriage; or acquired while married by gift,
bequest, devise, or descent; or the rents, issues, and profits of either of the foregoing (Fam 770)
where neither spouse has any interest in the separate property of the other. Fam 752. Moreover,
separate property may also be acquired by transmutation (the transfer of one spouses inter-
est in property to the other spouse, other than in a will) (CC 850, et seq.), or while the parties
are separated (Fam 771, 772).
When dealing with the characterization of jointly held property as community or other-
wise, care must also be taken to recognize the purposes for which the characterization is being
made, as the results will vary. For example, some statutes defining community property limit
their application to particular circumstances. Prob 28(b) and (c) defining community property
are applicable only for probate purposes; whereas Fam 2581 (defining joint tenancy interests
acquired by husband and wife as community property absent an express declaration in the
grant that the property interests of the spouses are held as separate property) is expressly ap-
plicable only to dissolution proceedings.

Intestacy (Hower 54)


The laws of intestate succession in California are generally found in Prob 6400, et seq. Contrary
to other community property states, in California the length of the marriage has no effect upon
the distribution of community property or separate property by intestate succession.

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Division (Hower 54)
As stated in the text, at dissolution (California is a no-fault state) the community property is
divided equally between the spouses and the separate property of each is affirmed. As previ-
ously noted, however, a transmutation of the separate or community property of each spouse
may be undertaken, dividing the estate even in the absence of a dissolution. To be valid, a
transmutation must be in writing, expressly declaring the transmutation, and made, joined
in, consented to, or accepted by the spouse whose interest is adversely affected. Fam 852(a);
Estate of MacDonald, 51 Cal.3d 262, 272 Cal.Rptr. 153 (1990). However, no writing is required
for gifts between spouses of clothing, wearing apparel, jewelry, or other tangible personal
items not of substantial value in light of the circumstances of the marriage. Fam 852(c).

Creditors Rights (Hower 54)


In general, the separate property of a spouse and the community property are available to sat-
isfy the debts of that spouse. Additionally, the separate property of the other spouse may be
available to satisfy debts for necessaries of life of that persons spouse; however, the paying
spouse is entitled to reimbursement if separate property of the other spouse or nonexempt
community property is available. Fam 910916.

Quasi-community Property (Hower 55)


Quasi-community property is generally treated the same as community property. Fam 125,
912, 2660; Prob 66.

ESTATES IN REAL PROPERTY (HOWER 56)


Estates in real property are generally treated at CC 761, et seq.

Freehold Estates (Hower 57)

Fee Simple Estate or Fee Simple Absolute (Hower 57)


Fee simple estates are defined at CC 762764. In 1983, California did away with the distinction
between fee simple determinable estates and fee simple estates subject to a condition subse-
quent. All such estates are now considered fee simple subject to a condition subsequent giving
rise to a power of termination should the stated condition arise. CC 885.010, et seq. The abo-
lition of fee simple determinable estates replaced the common law possibility of reverter which
accompanied that estate, with the requirement of affirmative action in exercising the power of
termination (known at common law as a right of re-entry).

Life Estate (Hower 60)


Life estates (treated at CC 761, 766, 779, and 818) are as explained in the text.

Future InterestsReversion and Remainder (Hower 61)


Future interests, reversions, and remainders are addressed in CC 767, et seq.

Dower and Curtesy (Hower 64)


Dower and curtesy have been abolished in California. C 5129, Prob 6412.

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Spouses Right to Election or Elective Forced Share ( Hower 65)
A surviving spouses election to take against a decedent spouses will is limited to those in-
stances in which the will purports to convey all or some portion of the surviving spouses half
interest in community (or quasi-community) property. Prob 141. Thus, if a spouse dies leaving
a will which devises to another all of the community property (including the surviving
spouses 50% interest in that property), the surviving spouse is given an election to take what
is provided for him or her in the will, or to take his or her intestate share of the estate as though
no will existed. If the election is made to take against the will, the electing spouse receives his
or her intestate share of the probate estate first, and the balance of the estate remaining is then
distributed in accordance with the decedents will. The election is made by filing a statement
with the court indicating that the surviving spouse claims his or her one-half share of com-
munity (and/or quasi-community) property, or that the spouse waives that right and consents
to the distribution of property in the will.

Waste (Hower 66)


CC 818 provides that a life tenant may use the land in the same manner as an owner in fee sim-
ple; however, He must do no act to the injury of the inheritance.

Leasehold Estates (Hower 66)

Tenancy or Estate for Years (Hower 66)


Pursuant to CC 717, no lease of agricultural land may be valid for a longer period than 51 years;
and no lease of any town or city lot (CC 718) or for the production of minerals, gas, oil, or other
hydrocarbons in excess of 99 years in duration is valid. CC 718f.

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3 THE PARTICIPANTS AND THE
PROPER COURT

THE PARTICIPANTS (HOWER 70)

The Personal Representative (Hower 70)

Appropriate Terminology (Hower 70)


In California, an executor is a person named in a will by a decedent to carry out the terms of
the will. Prob 8420, et seq. An administrator with will annexed is appointed where the dece-
dent died testate (having written a will) but no executor was named in the will or all named in
the will as executors were unwilling or unable to assume that role. Prob 8440. An administra-
tor is appointed as personal representative where the decedent died intestate (without a will).
Prob 8460(a). A special administrator is appointed where immediate action is required with
regard to the estate but no permanent personal representative has yet been appointed. Prob
8540(a).

The Role of the Personal Representative (Hower 71)


The role of the personal representative is as described in the text; however, the authority of the
personal representative to act is dictated by whether the personal representative is appointed
under the Independent Administration of Estates Act (Prob 10400, et seq.), and whether, if so
appointed, the personal representative has been granted independent authority by the court
to sell real property, exchange real property, grant an option to purchase real property, or bor-
row money with the loan secured by an encumbrance upon real property. Absent such au-
thority, all of the personal representatives dealings must be approved by the court.
Each personal representative is required to acknowledge receipt of a statement of duties
and liabilities in a form prescribed by the Judicial Council, prior to issuance of letters to the ap-
pointee. Prob 8404.

The Attorney (Hower 75)


The conduct of attorneys in California is governed by the provisions of the State Bar Act found
in the California Business & Professions Code (B&P 6000, et seq.) and the California Rules of
Professional Conduct.
Prob 2640 provides for court-approved payment of attorneys fees in conjunction with
guardianships and conservatorships. Prob 2644 authorizes contingent fee contracts, in writing,
with attorneys when such is to the advantage, benefit and best interest of the ward or con-
servatee or the estate . . .

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Prob 10810 establishes a fee schedule based upon the value of the estate accounted for by
the personal representative for compensation of an estate attorney for conducting ordinary
proceedings as follows:

Four percent (4%) on the first fifteen thousand dollars ($15,000);


Three percent (3%) on the next eighty-five thousand dollars ($85,000);
Two percent (2%) on the next nine hundred thousand dollars ($900,000);
One percent (1%) on the next nine million dollars ($9,000,000);
One-half of one percent (0.5%) on the next fifteen million dollars ($15,000,000); and
A reasonable amount determined by the court for all estates above twenty-five million dol-
lars ($25,000,000).

Thus, for example, an attorney representing an estate with a total value of $100,000 shall
receive compensation of $3,150 (being .04  $15,000  $600 plus .03  $85,000  $2,550, to-
talling $3,150); or, for an estate with a value of $600,000, authorized attorneys fees for ordinary
services would be $13,750 (being .04  $15,000  $600 plus .03  $85,000  $2,550 plus .02 
$500,000  $10,000, totalling $13,750).
In addition, Prob 10811 authorizes the award of additional compensation for attorneys ex-
traordinary services in an amount determined to be just and reasonable by the court.
A will may make provision for the payment of attorneys fees; however, if it does, those
fees shall be the full and only compensation of the attorney for the personal representative
unless the personal representative or the attorney petition to be relieved from that provi-
sion of the will and the court determines, after notice to all interested parties and hearing,
that it is to the advantage of the estate and in the best interest of all interested in the estate
to authorize an award of attorneys fees in excess of that provided for in the will. Prob
10812. Any agreement for payment of attorneys fees in excess of those permitted by statute
is void. Prob 10813.
Moreover, if a special administrator is appointed, the combined fees of the attorneys for
both the special administrator and the other personal representative cannot exceed the sums
set forth by statute for the ordinary and extraordinary services of attorneys for personal rep-
resentatives. Prob 8547(c) and (d).
However, Prob 10804 provides that a personal representative who is an attorney may be
compensated as a personal representative, but may not receive compensation as the estate at-
torney unless the court specifically approves the right to compensation in advance after find-
ing that the arrangement is to the advantage, benefit, and best interests of the estate.

The Paralegal or Legal Assistant (Hower 77)


Prob 2645 specifically states that:

Legal services for which the attorney may be compensated include those services
rendered by any paralegal performing the legal services under the direction and
supervision of an attorney. The petition or application for compensation shall set
forth the hours spent and services performed by the paralegal.

The Probate Court/Jurisdiction (Hower 78)


Exclusive jurisdiction over all probate matters rests with the Superior Court in California. Prob
7050. There is one Superior Court for each county in the State.

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Venue (Hower 84)
The proper venue for probate proceedings is the county in which the decedent was domi-
ciled at the time of death, and not the place of death. Prob 7051. If the decedent was a non-
domiciliary, then proper venue is in the place of death if the decedents property is also located
there; or, if the decedent owned no property located at the place of death or if the place of death
was outside California, then the proper venue is any county in which the decedent owned
property at the time of death. If property is located in more than one county, then proper venue
is in the county in which a petition for ancillary administration is first filed. Prob 7052.

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4 THE LAW OF SUCCESSION:
DEATH TESTATE OR
INTESTATE

DEATH WITH A WILLTESTACY (HOWER 90)

Terminology Related to Wills (Hower 90)

Holographic Will (Hower 91)


As noted in the text, California does recognize the validity of holographic wills. Prob 6111. To
be valid, a holographic will must be signed by the testator and the wills material provisions
must be in the handwriting of the testator, and such a document will constitute a valid holo-
graphic will whether it has been witnessed or not. Prob 6111(a). In addition, the entire will need
not be in the testators handwriting; statements of testamentary intent in holographic wills
may be made either in the testators handwriting or as part of a commercially printed form
will. Prob 6111(c). A holographic will may be proved in the same manner as any other writing
(Prob 8222) including through the use of extrinsic evidence (Prob 6111.5). A holographic will
need not be dated to be valid; however, if not dated and the provisions of the holographic will
are inconsistent with the provisions of another will, the holographic will is invalid to the ex-
tent of the inconsistency unless the date of execution of the holographic will is proven to be af-
ter the date of execution of the other will. Prob 6111(b)(1).

Nuncupative Will (Hower 92)


As noted in the text, California does not allow nuncupative wills.

Statutory Will (Hower 92)


Prob 6200, et seq., set forth the provisions regarding the statutory will authorized in Califor-
nia, including the California statutory will form itself (Prob 6240) and its mandatory clauses
(Prob 6241).

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Types of DispositionsGifts Made in a Will (Hower 97)

Bequest, Legacy, or Devise (Hower 97)


In California, a devise is a gift, or real or personal property, in a will (Prob 32), and vests at the
death of the transferor. Prob 21116. Prob 2117 defines the classes of testamentary gifts in Cali-
fornia as:

specific giftstransfers of specifically identified property;


general giftstransfers from general assets that do not give specific property;
demonstrative gifta general gift that specifies the fund or property from which the gift
is to be made;
general pecuniary gifta gift of a fixed dollar amount or in an amount determinable by
the provision of the instrument giving the gift;
annuitya pecuniary gift that is payable periodically;
residuary gifta transfer of a gift that remains after satisfaction of all specific and gen-
eral gifts.

Ademption, Lapses, and Abatement (Hower 99)


Ademption (Hower 99)
The recipient of a specific gift has a right to any portion of the specific gift remaining at the time
of transfer plus any balance owing or amount due by reason of the sale or transfer of the spe-
cific gift by the transferor. Prob 21133.

Lapses (Hower 100)


Gifts to devisees who do not survive the decedent fail. Prob 21109. Failed gifts become a por-
tion of the residuary estate. Prob 21111(a). If a residuary gift or future interest is transferred to
two or more persons, but the share of one transferee fails from any reason, then that share passes
to the other transferee(s) in proportion to their interest in the gift or future interest. Prob 2111(b).

Abatement (Hower 101)


The overriding concern in abating gifts is to do so in a manner which will not defeat the trans-
ferors plan or purpose. Prob 21400. No distinction is drawn between real and personal prop-
erty for purposes of determining priority in abatement. Prob 21401. Gifts abate in the follow-
ing order, pursuant to Prob 21402:

1. Property not disposed of by the instrument.


2. Residuary gifts.
3. General gifts not to the transferors relatives.
4. General gifts to relatives.
5. Specific gifts to others than the transferors relatives.
6. Specific gifts to relatives.

Within any class of gifts, shares of beneficiaries abate pro rata. Prob 21403(a). Annuities and
demonstrative gifts are treated as specific gifts to the extent that they are given out of the identi-
fied fund, and general gifts to the extent that they may be satisfied out of property other than the
specified source. Prob 21403(b). If a specific gift is subject to abatement, the recipient may satisfy
the contribution for abatement out of other property to preserve the specific gift. Prob 21405. A
specific gift is not subject to abatement to exonerate another encumbered specific gift. Prob 21404.

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DEATH WITHOUT A WILLINTESTACY (HOWER 106)

Intestate Succession Statutes (Hower 109)

General Rules of Distribution Under State Intestate Succession Statutes (Hower 116)
The bulk of the intestate succession laws are set forth in Prob 6400, et seq. in California. As Cal-
ifornia is a community property state, the intestate succession laws take into account the dis-
tinction between community property and separate property and treat each differently. [Please
note, as previously discussed, that community and quasi-community property are treated
identically in California. Hence, all further references to community property in this supple-
ment should be understood to include quasi-community property as well.]
In California, if a decedent dies survived by a spouse, all of the community property in-
terest of the decedent passes to the surviving spouse. Prob 6401(a) and (b). This, combined with
the surviving spouses one-half interest, results in the surviving spouse being the sole owner
of all of the community property.
The decedents separate property is distributed in accordance with Prob 6401(c). The sur-
viving spouse receives all of the separate property as well if the decedent is not also survived
by any issue, parent, brother, sister, or issue of a deceased brother or sister. Prob 64901(c)(1).
The surviving spouse receives one-half (1/2) of the decedents separate property if the
decedent also leaves either: (a) one child or the issue of one deceased child, or (b) no issue, both
a parent or parents or their issue, or the issue of either of them. Prob 6401(c)(2).
The surviving spouse receives one-third (1/3) of the decedents separate property if the
decedent is also survived by: (a) more than one child; (b) one child and the issue of one or more
deceased children; or (c) issue or two or more deceased children. Prob 6401(c)(3).
That part of the intestate estate not passing to the surviving spouse, as above, or if there is
no surviving spouse, is distributed (according to Prob 6402(a)) to the surviving issue of the dece-
dent, in equal shares if of equal degree. If the issue are not of equal degree, then those of more
remote degree take as provided in Prob 240 (per stirpesthose of the nearest generation to the
decedent still living each get a share, and the issue of those of that generation who are deceased
equally divide the share of their deceased ancestor of that generation). Prob 6402(a) and 240.
If there are no surviving issue, then the estate passes to the following categories of persons,
per Prob 6402(c), either equally, if all of the same degree of kinship, or as provided in Prob 240,
described above. If there are no surviving persons in the category identified, then the estate
passes to the next category identified, in the order indicated:

First, to the decedents parents.


Next, to the issue of parents or either of them.
Next, to the grandparents or issue of grandparents.
Next, to the issue of a predeceased spouse.
Next, to the decedents closest next of kin (if two or more kindred of equal degree claim
through different ancestors, then those claiming through the nearest ancestor are preferred).
Finally, to the parents of a predeceased spouse, or to the surviving issue of such predeceased
parents.

Notwithstanding the provisions of Prob 6402, if there are no surviving spouse or issue of a dece-
dent, and the decedent had a predeceased spouse who died less than fifteen (15) years before the
decedent, then the real property of the decedent attributable to the decedents predeceased

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spouse passes, according to Prob 6402.5(a), to the predeceased spouses issue, parents, issue of
parents, and then kin. With regard to personal property having documents of title and an aggre-
gate value in excess of $10,000, if the predeceased spouse died less than five (5) years before the
decedent, pursuant to Prob 6402.5(b), such personal property passes in a like manner.
In order to take by intestate succession, a person must survive a decedent by 120 hours.
Prob 6403. Relatives of the halfblood, adopted persons, and those conceived before but not
born until after the decedents death take as if they were relatives of the whole blood or had
been born prior to the decedents death. Prob 6406, 6407, 6450, and 6451.
If a person is related to a decedent by two lines of relationship, he or she may take only a
single share through the line of relationship resulting in a larger share. Prob 6413.

RIGHT OF REPRESENTATION (HOWER 111)


In California, the phrase by right of representation may have one of two meanings, depend-
ing upon the circumstances under which it is used.
Whenever property passes by intestate succession, or a will specifies that property
passes to the issue of a deceased beneficiary but does not specify by what method, distribu-
tion is made by dividing the property into as many equal shares as there are living members
of the nearest generation of issue then living and deceased members of that generation with
issue then living. Each living member of that generation receives one share and each de-
ceased members share is divided in the same manner among his or her then-living issue.
Prob 240.
Whenever a will, trust, or other document specifies that property is to be divided by
right of representation or per stirpes, then the property is first divided into the number of
shares equivalent to the total number of children living or deceased but having living issue,
with each living child receiving a share and each deceased childs share divided in the same
manner. Prob 246.

Escheat (Hower 115)


If there is no surviving person to whom a decedents estate may pass pursuant to the laws of
intestate succession, the estate escheats to the State. Prob 6404 and 6800, et seq.

RIGHTS OF FAMILY MEMBERS TO A DECEDENTS ESTATE


(HOWER 117)

Rights of a Surviving Spouse (Hower 117)

Surviving Spouses Elective (Forced) Share (Hower 119)


As previously noted, if a testator purports to devise the community property interest of a surviv-
ing spouse in his or her will, the spouse is put to an election to take either according to the provi-
sions of the will, or to take his or her intestate share of the estate. Prob 141. If the surviving spouse
elects his or her intestate share, that property is abated for purposes of distribution and only the
balance of the estate is subject to distribution according to the will. This same right to an elective
share arises whether or not the decedent or surviving spouse was a domiciliary of California, as
long as the decedent left a will disposing of real property located in California. Prob 120.

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Effect of Divorce and Marriage on a Spouses Rights (Hower 122)
A final dissolution or an annulment of marriage terminates an ex-spouses intestate succession
rights (Prob 78) and revokes any disposition or appointment made in a will executed prior to
the dissolution, unless the will expressly provides otherwise, or the parties subsequently re-
marry. Prob 6122, 6227. However, a mere decree of legal separation which does not terminate
the marriage does not affect the spouses inheritance rights (Prob 6122(d), 6227(c)); however,
being a party to an action for separate maintenance, annulment or dissolution and living apart
from the decedent at the time of the decedents death will affect the spouses priority for ap-
pointment as or nomination of an administrator of the decedents estate. Prob 8462, 8463.
If a testator fails to provide for his or her surviving spouse by will and the spouse and tes-
tator married after the execution of the testators will, then (absent evidence that the testator
failed to provide for the spouse intentionally, or that the testator otherwise provided for the
spouse outside the will, or that the spouse made a valid agreement waiving any share in the
estateProb 6561), the omitted (pretermitted) spouse will receive the testators one-half of
the community and quasi-community property as well as the share of the testators separate
property that the spouse would have received had the testator died intestate. Prob 6560.

Rights of Children (Issue) (Hower 125)

Issue (Hower 125)


Issue are all of a persons lineal descendants of all generations. Prob 50.

Natural Children (Hower 126)


According to California law, a parent and child relationship exists for the purposes of deter-
mining intestate succession between a person and the persons natural parents, regardless of
the marital status of the natural parents. Prob 6450(a).

Adopted Children (Hower 126)


A parent and child relationship exists between an adopted person and the persons adopting
parent or parents. Prob 6450(b). Adoptions sever the relationship of parent and child between
an adopted person and a natural parent unless both: (1) the natural parent and the adopted
person lived together as parent and child or both natural parents were living together before
the person was conceived but one natural parent died before birth; and (2) the adoption was
by the spouse of, or after the death of, either of the natural parents. Prob 6451. A natural par-
ent cannot inherit from an adopted child (although the wholeblood siblings and issue of the
adopted person may). Prob 6451.

Nonmarital Children (Hower 127)


California no longer utilizes the term illegitimate in reference to children, since the marital
status of natural parents has no legal significance on the parent and child relationship, except
insofar as that a person may not inherit from a child born out of wedlock if no parent and child
relationship has been established. Prob 6450, 6452, 6453; Fam 7602.
California has adopted the Uniform Parentage Act (Fam 7600, et seq.) for purposes of de-
termining the existence of a natural parent and child relationship.
California also recognizes a parent and child relationship between a person and that per-
sons foster parent or stepparent for purposes of intestate succession, where it is shown that:
(1) the relationship began during the persons minority and continued throughout the joint

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lifetimes of the person and the foster or stepparent; and (2) the foster or stepparent would have
adopted the person but for a legal barrier to doing so. Prob 6454.

Pretermitted (Omitted) and Posthumous Children (Hower 128)


If a testator fails to provide in a will for a child born to the testator after the execution of the will,
the child is entitled to receive a share of the testators estate equal to that which the child would
have received had the testator died intestate (Prob 6570), absent evidence that: (1) the failure to
provide for the child was intentional and that intention appears from the will; (2) the testator had
one or more children at the time of execution of the will and devised substantially all of the es-
tate to the other parent of the omitted child; or (3) the testator provided for the child by transfer
outside the will with the intent that the transfer be in lieu of a testamentary share. Prob 6571.
If a testator fails to provide for a living child in a will at the time of executing the will solely
because of the testators erroneous belief that the child was dead or because the testator was
unaware of the birth of the child, the child is entitled to the share he or she would have received
had the testator died intestate. Prob 6572.

Additional Rights or Protections


for a Surviving Spouse and Children (Hower 129)

Homestead Exemption (Hower 129)


In addition to the declared homestead provisions (CCP 704.710, et seq.) which provide protec-
tion for the equity in real property held by an owner, California law provides for a single
probate homestead which may be set aside by the court for the surviving spouse and children.
Prob 6520, et seq. The probate homestead provides a surviving spouse with the right to stay in
for a period up to the balance of the spouses lifetime and the minor children with the right to
reside in the homestead property until the age of majority. Prob 6524. The homestead property
is selected from the community property of the estate, or property held jointly by the decedent
and those entitled to the homestead, or from property the right to possession of which is vested
in another, if the other consents to the homestead. Prob 6522. The homestead property may be
used to satisfy the costs of administration, creditors claims, and estate liabilities, subject to the
homestead rights of the surviving spouse and/or children declared by the court. Prob 6526. The
probate homestead is sought, declared, and amended by a petition process. Prob 6525, 6527.

Exempt Property (Hower 131)


The court may set aside to the surviving spouse or the minor children of the decedent, or both,
all or any part of the property of the decedent exempt from enforcement of a money judgment,
other than the family dwelling, on consideration of a petition filed by any interested person.
Prob 6510, 6511.
In addition, until sixty (60) days after the filing of an inventory (or until such further time
as the court may direct), the surviving spouse and minor children of the decedent may
upon order of the court or upon petition by any interested person and for good cause
shownremain in possession of the family dwelling, the wearing apparel of the family, the
household furniture, and the other property of the decedent, exempt from enforcement of a
money judgment. Prob 6500, 6501.

Family Allowance (Hower 131)


California law provides that the surviving spouse, the minor children, and the adult children of
the decedent who are physically or mentally incapacitated and actually dependent upon the

16
decedent for support are entitled to such reasonable family allowance out of the estate as is nec-
essary for their maintenance and support during the administration of the estate. Prob 6540(a).
In addition, family allowancein the courts discretionmay also be given to other adult chil-
dren and parents of the decedent actually dependent, in whole or in part, upon the decedent for
support. Prob 6540(b).
A family allowance may be granted retroactively or prospectively from the date of the
courts order, for a time period specified by the court, but no earlier than the date of the dece-
dents death and no later than the distribution of the property of the estate or, if the estate is
insolvent, no later than one year after the granting of letters. Prob 6543.
Family allowances are sought by petition and may be granted or modified only after a
hearing, with notice to all interested persons. Prob 6541.

17
5 WILLS: VALIDITY
REQUIREMENTS,
MODIFICATION,
REVOCATION, AND CONTESTS

REQUIREMENTS FOR THE CREATION OF A VALID WILL


(HOWER 142)
The statutory requirements for creating a valid will in California are found in Prob 6100, et seq.

Intent of the Testator (Hower 143)


The intent of the transferor is controlling in the interpretation of testamentary documents.
Prob 21102(a). Only when the intent of the testator is not clear are the rules of construction set
forth in the statutes applied. Prob 21102(b).

Capacity of the Testator (Hower 143)


A testator must be at least eighteen (18) years of age and of sound mind to make a will. Prob 6100.
A person does not have mental competence to make a will if: (a) the individual doesnt
have sufficient mental capacity to:

1. understand the nature of the testamentary act;


2. understand and recollect the nature and situation of the individuals property; or
3. remember and understand the individuals relations to living descendants, spouse, and
parents, and those whose interests are affected by the will;

or (b) the individual suffers from a mental disorder with symptoms including delusions or hal-
lucinations, in which the symptoms result in the devising of property in a way which, except
for the delusions or hallucinations, the individual would not have done. Prob 6100.5.
To the extent that a will may have been procured by duress, menace, fraud, or undue in-
fluence, the will or a part of the will is ineffective. Prob 6104.

19
Formal Requirements of a Will (Hower 145)

A Written Will (Hower 145)


A will must be in writing (Prob 6110(a)) and signed (1) by the testator or (2) in the testators
name by someone else in the testators presence and at his or her direction. Prob 6110(b).
A will must also be witnessed and signed by two (2) persons, each of whom is present at
the same time and witnessed either the signing of the will or the testators acknowledgment of
the signature or of the will, and who understand that the document which they are signing is
the testators will. Prob 6110(c).
As previously discussed, a will which fails to meet the formal requirements previously set
forth may yet qualify as a holographic will if the signature and material provisions of the will
are set forth in the testators handwriting, whether or not witnessed, and regardless of whether
statements of testamentary intent are set forth in the handwriting of the testator or as part of a
commercially printed form will. Prob 6111.
A written will may also take the form of a California statutory will, also as previously dis-
cussed. See Prob 6200, et seq.

Nuncupative (Oral) Wills (Hower 92)


California does not recognize nuncupative (oral) wills.

Signature of the Testator (Hower 147)


See Prob 6110(b) and 6111, as previously noted.

Signatures of Witnesses (Hower 150)


See Prob 6110(c) and 6111, as previously noted.

MODIFICATION OF A WILLCODICIL VERSUS NEW WILL


(HOWER 154)
California statutory wills may be modified by codicil, as any other will might be. Prob 6226.

REVOCATION AND REJECTION OF A WILL (HOWER 156)

Revocation by Physical Act (Hower 156)


A will is revoked by being burned, torn, canceled, obliterated, or destroyed (or, if executed in du-
plicate, by such acts upon one of the duplicates (Prob 6121)) by the testator with the intent to re-
voke it, or by another person in the testators presence and at the testators direction. Prob 6120(b).

20
Lost Wills (Hower 157)
If neither a will nor a duplicate original, last known to be in the testators possession, cannot
be located after the testators death, it is presumed that the testator destroyed the will with the
intent to revoke it. Prob 6124.
However, lost or unintentionally destroyed wills may be proven by a petition including a
written statement of the testamentary words or their substance. Prob 8223.

Revocation by Operation of Law (Hower 159)


As previously noted, provisions of a will are revoked by dissolution or annulment of marriage
with regard to the rights of an ex-spouse. Prob 6122.
If a second will, which would have revoked a prior will had it remained effective at death,
is subsequently revoked, the first will remains revoked unless it is evident from the testators
subsequent or contemporaneous declarations or from the circumstances of the second revoca-
tion that the testator intended the first will to take effect. Prob 6123(a).

Revocation by Subsequent Writing (Hower 160)


A valid subsequent testamentary instrument will revoke a prior testamentary instrument either
expressly or insofar as the provisions of the two instruments are inconsistent, and the provisions
of the later instrument will be given effect over those of the earlier. Prob 6111(b), 6120(a).
If a second will, which would have revoked a first will had it remained in effect at the time
of death, is subsequently revoked by a third will, the first will is revoked except insofar as it
appears from the terms of the third will that the testator intended the first will to take effect.
Prob 6123(b).

WILL CONTESTS (HOWER 161)


The provisions regarding contest of a will are generally contained at Prob 8250, et seq.

Who Can Contest a Will (Hower 161)


Generally, any interested person may contest a will. Prob 1043, 8004(b), 8270(a).

Grounds for Contesting a Will (Hower 162)


A will may be contested on any ground which tests the validity of the document; for example,
lack of due execution (Prob 6110, 6111), lack of testamentary intent (Estate of Sargavak, 35 Cal.2d
93 (1950)), lack of testamentary capacity (Prob 6100, 6100.5), undue influence, fraud, duress
(Prob 8252(a)), mistake (Prob 8252(a)), or revocation (Prob 6120-6124). Prob 8252(a).

In Terrorem or No Contest ClauseA Forfeiture Clause (Hower 166)


In California, forfeiture clauses are valid according to their own terms (Prob 21300-21303); how-
ever, they are strictly construed. Prob 21304. If, however, a beneficiary with probable cause chal-
lenges a will on grounds of forgery or revocation, a no contest clause is not enforceable against
him or her. Prob 21306. Similarly, such a clause is not enforceable against a beneficiary, with prob-

21
able cause, who contests a provision that benefits: (1) a person who drafted or transcribed the in-
strument; (2) a person who directed the drafter of the instrument regarding its substantive pro-
visions or to include a no contest clause in the instrument; or (3) a person who acted as a witness
to the instrument. Prob 21307. Moreover, a beneficiary may seek declaratory relief from the court
by petition to determine whether a beneficiarys actions would constitute a contest within the
meaning of a no contest clause without reaching the merits of the clause or the action proposed
and, hence, without activating the bar of the no contest clause. Prob 21320, et seq.

22
6 PREPARATION TO DRAFT
A WILL: CHECKLISTS AND
THE CONFERENCE WITH
THE CLIENT

The discussion in the text is applicable to California practice.

23
7 FINAL DRAFT AND
EXECUTION OF A VALID WILL

CONTENTS OF A STANDARD WILL (HOWER 201)

SPECIFIC TESTAMENTARY GIFTS (HOWER 207)


Inter vivos transfers of property by a transferor to a testamentary beneficiary is treated as a sat-
isfaction of a testamentary gift to that person in whole or in part only if: (1) the instrument pro-
vides for the deduction of the lifetime gift from the testamentary gift; (2) the transferor declares
in a contemporaneous writing that the lifetime gift is to be deducted or is in satisfaction of the
testamentary gift; or, (3) the transferee acknowledges in writing that the lifetime gift is in sat-
isfaction of the testamentary gift. Prob 21135.

Appointment of a Personal and/or Property Guardian (Hower 214)


The provisions regarding guardianship, conservatorship, and other protective proceedings are
contained, generally, in Division 4 of the Probate Code. Prob 1400, et seq. In addition, the Cal-
ifornia Uniform Transfers to Minors Act can be found at Prob 3900, et seq.

Simultaneous Death Clause (Hower 216)


If a situation or document does not otherwise provide for disposition in instances of simulta-
neous death (Prob 221), and it cannot be established by clear and convincing evidence that one
person survived the other, the property of each person is administered or dealt with as though
that person did, in fact, survive the other. Prob 220. With regard to community and quasi-
community property, one-half of the property is dealt with as though one spouse survived the
other and the property is the surviving spouses; and the other half of the property is similarly
treated, as though the other spouse had survived the first. Prob 103.
If a right to receive property by a beneficiary is conditioned upon surviving another,
and it cannot be proven by clear and convincing evidence that the beneficiary did so sur-
vive, the beneficiary is deemed not to have survived the other. Prob 222(a). Similarly, if it
cannot be proven that either of two or more beneficiaries, or joint tenants, survived the oth-
ers, the property is divided into equal shares and distributed as if each had survived the
others. Prob 222(b), 223.
Moreover, in order to be deemed to have survived another, a person must survive a dece-
dent by 120 hours, or the person will be deemed to have predeceased the other (unless appli-
cation of the 120-hour survival requirement would result in escheat of property to the State).
Prob 6211, 6403.

24
Testamentary Trust Clauses (Hower 217)
The Rule Against Perpetuities and its application are contained in Prob 21200-21231.

ADDITIONAL NONTESTAMENTARY DOCUMENTS


(HOWER 224)

Self-proving Provision or Affidavit Clause that Creates a Self-proved Will


(Hower 224)
Prob 8220 provides for proof of a will, where there is no contest, on evidence of one witness to
the will only. Such evidence may consist of an affidavit of a subscribing witness to which a
copy of the will is attached, or by an affidavit in the original will that includes or incorporates
the attestation clause. Prob 8220(b).
In addition, if a subscribing witness is not available, the court may permit proof of the will
by: (1) proof of the handwriting of the testator and one witness; or, (2) proof of the handwrit-
ing of the testator and (a) a writing in the will bearing all of the subscribing witnesses signa-
tures or (b) an affidavit of a person with personal knowledge of the circumstances of the exe-
cution of the will. Prob 8221.

Right to Die Laws and Related Advance Medical Directive Documents


(Hower 228)

Durable Power of Attorney for Health Care (Hower 231)


Durable powers of attorney for health care are governed by the provisions of Prob 4600, et seq.,
and a statutory form durable power of attorney for health care deemed valid in California is
set forth in Prob 4701.

WHERE TO KEEP THE WILL (HOWER 240)


Prob 700, et seq. deals specifically with the duties and liabilities of attorneys with whom de-
posits of estate planning documents (including wills, trusts, powers of attorney, or other estate
planning documents) have been made.

25
8 INTRODUCTION TO TRUSTS

SCOPE OF THE CHAPTER (HOWER 245)


Trusts are generally addressed in Division 9 of the California Probate Code. Prob 15000, et seq.

THE ESSENTIAL ELEMENTS OF A TRUST (HOWER 250)

The Settlor: The Creator of the Trust (Hower 251)


A settlor must manifest an intention to create a trust to do so. Prob 15201. A trust may be cre-
ated for any purpose which is lawful and does not violate public policy. Prob 15203.
A trust may be created by a declaration by the settlor that he or she holds the trust prop-
erty as a trustee; a transfer of property by the owner during his or her lifetime to another as
trustee; a transfer of property by testamentary document to another as trustee; or an exercise
of a power of appointment to another person as trustee. Prob 15200.

The Settlor as Trustee or Beneficiary (Hower 252)


The settlor may also act as a trustee or beneficiary of the trust. However, if there are successor
beneficiaries after the death of the settlor, the trust is not merged or terminated if either: (1) the
settlor is both the sole trustee and sole beneficiary during the settlors lifetime; or (2) there are
two or more settlors, one or more of whom are trustees and one or more of whom are benefi-
ciaries during the lifetime of the settlors. Prob 15209.

The Trustee: The Fiduciary and Administrator of the Trust (Hower 253)

Natural or Legal Person as Trustee (Hower 253)


A trust company is an entity which has qualified to engage in and conduct a trust business in
California (Prob 83) and may be appointed to act as a trustee in the same manner as an indi-
vidual (Prob 300) without the requirement of giving a bond. Prob 301.

Co-Trustees (Hower 255)


A co-trustee has an obligation to participate in the administration of the trust, and to take rea-
sonable steps to prevent a co-trustee from committing a breach of trust or to compel a co-
trustee to redress a breach of trust. Prob 16013.
Unless otherwise expressly authorized in the trust document, a power granted co-trustees
must be exercised only by unanimous action. Prob 15620.

27
A co-trustee may act alone for the trust only where they are the only other trustee and their
co-trustee is absent, ill, or temporarily incapacitated, or where there is a vacancy in the office
of the co-trustee, where necessary to accomplish the purposes of the trust or to avoid ir-
reparable injury to the trust. Prob. 15621, 15622.

Acceptance or Disclaimer of Trusteeship (Hower 255)


A person may accept the position of trustee by a written acceptance, either by signing the trust
document or through a separate document; or by knowingly exercising trust powers or au-
thorities (except where the person does so solely to preserve trust property to which there is
an immediate risk of damage and the person delivers a written rejection of the trust to the set-
tlor or, if the settlor is dead, to the beneficiary, within a reasonable time). Prob 15600.
A person named a trustee may reject the trusteeship either by a writing, or by not under-
taking any of the acts of acceptance previously identified, within a reasonable time after be-
coming aware of being named as trustee. Prob 15601.

Removal or Resignation of Trustee (Hower 255)


A vacancy in the position of trustee arises either through resignation or removal, or through
death, rejection, inability to identify or lack of existence of the trustee, or appointment of a
guardian or conservator of a trustee, bankruptcy of the trustee, revocation of a trust companys
charter or suspension of its powers, or appointment of a receiver for a trust company. Prob. 15643.
Having accepted the position, a trustee may resign only: (1) as provided in the trust in-
strument; (2) if the trust is revocable, with the consent of the person holding the power to re-
voke; (3) if the trust is irrevocable, with the consent of all adult beneficiaries or conservators of
beneficiaries; or (4) pursuant to a court order to do so. Prob 15640. A resigning trustees liabil-
ity or the liability of the trustees bond is not affected by his or her resignation. Prob. 15641.
A trustee may be removed in accordance with the provisions of the trust document or by
a court, either on its own motion or on the petition of a settlor, co-trustee, or beneficiary.
Grounds for removal by the court include: (1) breach of trust by the trustee; (2) unfitness or in-
solvency of the trustee; (3) hostility or lack of cooperation among co-trustees impairing trust
administration; (4) failure to act by the trustee; (5) excessive compensation to the trustee;
(6) disqualification of the sole trustee; or (7) for other good cause. Prob 15642.
If a vacancy does occur in the position of trustee, a trustee may be appointed by any
method specified in the trust instrument; or, failing that, by appointment of a trust company
with the consent of the beneficiaries; or, failing that, by appointment of a trustee by the court,
giving consideration to any nominations by beneficiaries over the age of 14; or, failing the ap-
pointment of any other qualified person willing to act as trustee, the court may appoint the
public guardian as trustee of the trust. Prob 15660, 15660.5.

Powers of the Trustee (Hower 256)


A trustee has any powers conferred by the trust instrument, and (except as limited by the trust
instrument) those powers conferred by statute or to perform any act that a trustee would per-
form to fulfill its standard of care. Prob 16200. However, the mere grant of power to a trustee
does not require its exercise, and the exercise of any power by a trustee is subject to the trustees
fiduciary duties. Prob 16202.
By statute (and absent limitation in the trust document), trustees have the power to:

Collect, hold, and retain trust property (Prob 16220).


Accept additions to the trust property (Prob 16221).

28
Continue, operate, incorporate, dissolve, or change the form of a business or enterprise
(Prob 16222).
Invest (Prob 16223, 16224).
Make deposits (Prob 16223).
Acquire and dispose of property, for cash or credit, at public or private sale, or by exchange
(Prob 16226).
Manage, control, develop, divide, improve, exchange, partition, abandon, or change the
character of trust property (Prob 16227).
Encumber, mortgage, or pledge trust property (Prob 16228).
Repair, alter, improve, demolish, raze, or erect trust property (Prob 16229).
Subdivide, develop, dedicate to public use, adjust boundaries, exchange, partition, or ded-
icate easement of land (Prob 16230).
Lease (Prob 16231 and 16232).
Grant or acquire options (Prob 16233).
Hold securities, vote, waive notice, consent, or exercise the rights of shareholders, members,
or owners (Prob 16234-16239).
Insure trust property (Prob 16240).
Borrow money (Prob 16241).
Pay, contest, release, or settle claims (Prob 16242).
Pay trust expenses, taxes, assessments, fees, employees, and agents (Prob 16243).
Make and guarantee loans to the beneficiary (Prob 16244).
Make distributions to beneficiaries and others (Prob 16245, 16246).
Hire persons and agents (Prob 16247).
Execute and deliver instruments (Prob 16248).
Prosecute and defend actions, claims, and proceedings (Prob 16249).
Apportion income and expenses between principal, interest, and beneficiaries (Prob 16300-
16315).

Duties of the Trustee (Hower 257)


The trustees duties are governed generally by the provisions of Prob 16000-16015.

Duty of Performance and Due Care (Hower 257)


The trustee has a duty to administer the trust in accordance with the terms of the trust instru-
ment and statute, to the extent not limited by the trust instrument. Prob 16000. The trustee may
not delegate to others the performance of acts the trustee can reasonably be required to per-
sonally perform and must exercise supervision over those to whom matters have properly
been delegated by the trustee. Prob 16012.
A trustee has a duty to use the full extent of the trustees skills in administration of the trust,
and if a settlor has selected a trustee because of a representation of the trustees having special
skills, the trustee is held to the standard of the skills represented. Prob 16014.
A trustee must administer a trust with the care, skill, prudence, and diligence under the
circumstances that a prudent person acting in a like capacity and familiar with such matters
would use in the conduct of an enterprise of like character with like aims to accomplish the
purposes of trust as determined from the trust instrument. Prob 16040(a).

29
Duty of Loyalty (Hower 258)
The trustees duty of loyalty is to administer the trust solely in the interest of the beneficia-
ries (Prob 16002(a)) and, if there are two or more beneficiaries, to deal with them impartially.
Prob 16003.
A trustee of two trusts may sell or exchange trust property between the trusts if (a) the sale
or exchange is fair and reasonable to the beneficiaries of both trusts and (b) the trustee has
given notice to all beneficiaries of all of the material facts known (or which should be known)
to the trustee. Prob 16002(b). However, a trustee of one trust may not knowingly become a
trustee of another trust adverse to the interests of the beneficiaries of the first trust and has a
duty to eliminate the conflict or resign when the conflict becomes known. Prob 16005.
A trustee has a duty not to use or deal with trust property for the trustees own benefit or
for any purpose not connected with the trust, and a trustee may not take part in any transac-
tion in which the trustee has an interest adverse to the beneficiary (Prob 16004(a)), including
not enforcing claims against trust property acquired by the trustee after contemplation of ap-
pointment as trustee. Prob 16004(b).
Any transaction between trustee and beneficiary during the term of the trust or while the
trustee holds influence over the beneficiary by which the trustee gains an advantage from the
beneficiary (other than agreements for the hiring or compensation of the trustee) is presumed
to violate the trustees fiduciary duties. Prob 16004(c).

Duty to Take Possession of and Preserve Trust Property (Hower 259)


The trustee has a duty to take reasonable steps to take, keep control of, and preserve trust prop-
erty (Prob 16006); to enforce claims that are part of the trust property (Prob 16010); and to de-
fend actions that may result in a loss to the trust (Prob 16011).

Duty to Invest the Trust Property (Hower 260)


A trustee has a duty to make the trust property productive under the circumstances (Prob 16007)
and to dispose of trust property that would not be a proper investment for the trustee to make
and retain trust property which is in the best interests of the trust or in furtherance of the trust
purposes. Prob 16008.
A trustee investing trust property must act with the care, skill, prudence, and diligence un-
der the circumstances then prevailing that a prudent person acting in a like capacity and fa-
miliar with such matters would use in the conduct of an enterprise of like character and with
like aims to accomplish the purposes of the trust. Individual investments will be considered as
part of an overall investment strategy. Prob 16040(b).

Duty to Make Payments of Income and Principal to the Beneficiaries (Hower 262)
Payments of principal and income must be made in accordance with the express terms of the
trust. Prob 16302(a)(1). In the absence of such express contrary direction, payments are made,
first, pursuant to statutory direction, or pursuant to what is reasonable and equitable in view
of the interests of those entitled to income or principal, in accordance with the standard of care
imposed upon the trustee by statute. Prob 16302(a)(2) and (3).
The statutory scheme regarding distribution of income and application of principal and in-
terest is set forth in Prob 16300-16315.

Duty to Account (Hower 264)


A trustee owes an obligation to the beneficiaries to keep them reasonably informed of the trust
and its administration (Prob 16060), and to account either on request (Prob 16061) or annually,
at the termination of the trust, or at a change of trustees to each beneficiary entitled to income
or principal. Prob 16062.

30
The account shall contain a statement of receipts and disbursements; assets and liabilities;
trustees compensation; a statement that a court review may be obtained by petition; and a
statement that claims against the trustee for breach of trust may not be made after three years
from the date the beneficiary receives the accounting or report of the trustee. Prob 16063.
No accounting may be required where the beneficiary and trustee are the same person;
where the right to an accounting or report has been waived in writing by the beneficiary (how-
ever, such a waiver may be revoked in writing); or where the trust is revocable and the bene-
ficiary does not hold the power to revoke at the time. Prob 16064.
Any limitation or waiver in a trust instrument of the obligation to account is against pub-
lic policy and void. Prob 16062(e).

Liability of Trustee to Beneficiary (Hower 265)


Any violation by a trustee of a duty owed to the beneficiary is a breach of trust for which the
trustee is liable. Prob 16400. A trustee is only liable for the acts of agents which the trustee im-
properly supervised, delegated, authorized, hired, concealed, or directed (Prob 16401), and for
the acts of a co-trustee which the trustee participated in, approved, concealed, negligently per-
mitted to occur, or failed to cause the co-trustee to redress. Prob 16402.
A trustee is not liable for the acts of a predecessor trustee, unless the trustee knowingly fails
to correct those acts, or to cause them to be redressed, or to cause property to be delivered to
the successor trustee. Prob 16403.
A trustee is liable for a breach of trust to a beneficiary for any loss or depreciation in value of
the estate, with interest; any profit made by the trustee through the breach of trust, with interest;
or any profit that the trust would have realized, with interest, but for the breach. Prob 16440(a).
If a court determines that the trustee acted in good faith under the circumstances known to it, it
may relieve the trustee of liability for any of these sums. Prob 16440(b).
In addition, a beneficiary may pursue equitable remedies against the trustee to compel the
performance of duties; to enjoin a breach of trust; to compel redress; to remove the trustee; to
set aside the acts of the trustee; to appoint a receiver or temporary trustee; to reduce or deny
compensation to the trustee; to trace and recover property; or to impose an equitable lien or
constructive trust on trust property. Prob. 16420 and 16421.
However, exculpatory provisions of the trust instrument itself may relieve the trustee of
any liability to the beneficiary (Prob 16461(a)) so long as the breach is not committed inten-
tionally, with gross negligence, in bad faith, with reckless disregard, or for any profit realized
by the trustee from the breach. Prob 16461(b).
In addition, the trustee may be relieved of liability by the beneficiarys consent (Prob 16463);
written permission or direction from the person holding the power to revoke a revocable trust
(Prob 16462); release by, or contract with, the beneficiary (Prob 16464); or affirmation of the
transaction by the beneficiary (Prob 16465).

Cost of a Trustee (Hower 266)


Generally, a trustee is not required to post a bond. However, a trustee may be required by the
terms of the trust to post a bond to secure performance of the trustees duties. A court may
modify the terms, amount, or requirement for the posting of a bond. And, in any event and
even if such is required by the terms of a trust, a trust company may not be required to give a
bond. Prob 15602.
The cost of a trustees bond is paid by the trust estate, unless specifically otherwise pro-
vided in the trust instrument. Prob. 15602(d).
Absent express provisions otherwise, a trustee is entitled to reasonable compensation. Prob
15681. A trust may expressly provide for a trustees compensation, subject to a courts determi-

31
nation to increase or decrease such compensation based upon the circumstances. Prob 15680. A
trustees fee may also be increased on sixty (60) days written notice to beneficiaries. Prob 15686.
However, an attorney serving as trustee may receive compensation only either as trustee or as
attorney for the trustee (and any family member, law partnership, or law corporation associated
with the trustee may not receive any compensation) unless first authorized without objection,
or pursuant to court order if there is objection, upon thirty (30) days advance written notice to
all interested persons. Prob 15687.
A trustee is also entitled to reimbursement out of the trust property for expenditures in-
curred in the administration of the trust or for the benefit of the trust (Prob 15684) and the
trustee has an equitable lien on the trust property as against the beneficiary for advances, plus
interest, for the benefit of the trust and for expenses of administration. Prob 15685.

The Beneficiary: Recipient of the Trust Property or Benefits (Hower 267)


There must be an identified beneficiary for a trust to be valid. Prob 15205(a). However, the
beneficiary may either be an identifiable person or a class of beneficiaries ascertainable with
reasonable certainty or sufficiently described that it can be determined that some person
meets the description or is within the class identified. Prob 15205(b)(1). Alternatively, a
power to appoint beneficiaries given to the trustee according to some elucidated standard or
in the trustees or another persons discretion is a sufficient identification of the beneficiary.
Prob 15205(b)(2).
A beneficiary may disclaim any interest by filing with the Superior Court or the trustee a
written disclaimer, signed by the beneficiary, which includes the identity of the creator of the
interest, describes the interest to be disclaimed, and states the disclaimer and the extent of it.
Prob 260, et seq.

Nature of the Beneficiarys Interest (Hower 268)


A beneficiary of a trust is one who has a vested or contingent, present, or future interest in the
trust, or one who is entitled to enforce the trust. Prob 25(c) and (d). A beneficiary is entitled to
special notice of any proceedings regarding a trust (Prob 17204) as well as an accounting from
the trustee of the trust assets, liabilities, and status. Prob 16061.
With regard to revocable trusts, and absent an express trust provision otherwise, where the
power to revoke rests with one other than a beneficiary, the person holding the power to re-
voke, and not the beneficiary, is granted the right to consent, of appointment or withdrawal,
and right to notice otherwise due a beneficiary. Prob 15800, et seq.
A beneficiarys interest or the trust principal may be restrained from transfer or protected
from creditors of the beneficiary by express language in the trust. Prob 15300-15303. However,
a settlor may not protect himself or herself from claims of his or her own creditors through the
creation of a trust with limiting language of which the settlor is also the beneficiary or over
which the settlor retains a power of revocation. Prob 15304, 18200.
Moreover, (a) claims for spousal or child support for the trust beneficiarys spouse, former
spouse, or minor child; (b) restitution judgments against the beneficiary resulting from felo-
nious conduct by the beneficiary; or (c) liability of the beneficiary for reimbursement for pub-
lic support furnished to the beneficiary or the beneficiarys spouse or minor child, may be sat-
isfied from trust principal or interest (notwithstanding restraining language in the trust itself)
either: (1) for present and future payments by court order if the beneficiary has the right un-
der the trust to compel the trustee to pay income or principal to or for the benefit of the bene-
ficiary or (2) for future payments by order of a court, regardless of the beneficiarys power to
direct the trustee. Prob 15305, 15305.5, and 15306.

32
A court may also order payment of judgment creditors claims against the beneficiary not
withstanding a restraint on transfer of the beneficiarys interest in the trust. Prob 15306.5, 15307.

Trust Property (Hower 270)


There must be trust property for a trust to be created. Prob 15202. The trust property may be
either personal or real; but, if real, the Statute of Frauds applies and the trust must be in a writ-
ten document signed by the settlor or trustee. Prob 15206. In addition, a trust relating to real
property must be recorded in the county in which the real property or some of it is located.
Prob 15210. The existence and terms of an oral trust of personal property must be proven by
clear and convincing evidence, and the mere oral declaration of the settlor alone is not suffi-
cient to do so. Prob 15207.

TERMINATION OF TRUSTS (HOWER 272)


Trusts are terminated by: (1) expiration of the term of the trust; (2) fulfillment of the trust pur-
pose; (3) subsequent illegality of the trust purpose; (4) impossibility of fulfilling the trust pur-
pose; or (5) revocation of the trust. Prob 15407.
A trust may be terminated by order of the court on petition of a trustee or beneficiary if the
value of the trust property has become so low in relation to the cost of administration that con-
tinuation of the trust will defeat or impair its abilities to satisfy the trusts purpose. Prob 15408(a).
Also, the trustee has the power to terminate the trust if the trust principal does not exceed twenty
thousand dollars ($20,000). Prob 15408(b).
A trust may also be terminated if it continues in existence beyond the period of the statu-
tory rule against perpetuities (Prob 21205) on petition of either a majority of the beneficiaries
or the Attorney General (Prob 15414), and a trust provision that the trust may not be terminated
is ineffective in that circumstance. Prob 15413.
Trusts may also be combined or divided by court order if the court determines that to do
so would not substantially impair or defeat the interests of the beneficiaries or the trusts abil-
ity to satisfy their purposes. Prob 15411, 15412.
A court may modify or terminate a trust if, due to circumstances unforeseen or unknown to
the settlor, continuation of the trust would substantially impair or defeat the accomplishment
of the purposes of the trust. A court may also order the trustee to undertake acts specifically pro-
hibited or unauthorized by the trust instrument under those circumstances. Prob 15409.

33
9 CLASSIFICATION OF TRUSTS,
THE LIVING TRUST, AND
OTHER SPECIAL TRUSTS

CLASSIFICATION OF TRUSTS (HOWER 276)

Express TrustsPrivate versus Public (Charitable) (Hower 276)

Public (Charitable) Trust (Hower 277)


Charitable trusts are governed by the provisions of the Uniform Supervision of Trustees for
Charitable Purposes Act, enacted in California as Gov 12580, et seq., and are not subject to the
limitations of the rule against perpetuities since direct gifts to charities are vested and those af-
ter a life interest are exempted. Prob 21225(e).
Specific provisions regarding the duties of trustees of charitable trusts with regard to pro-
visions of the Internal Revenue Code may also be found at Prob 16100-16105.

Public TrustCy-pres Doctrine (Hower 279)


The cy-pres doctrine has been adopted by the courts in California. Estate of Faulkner, 128
Cal.App.2d 575 (1954); Estate of Quinn, 156 Cal.App.2d 684 (1958); Estate of Gatlin, 16 Cal.App.3d
644 (1971); Estate of Klinkner, 85 Cal.App.3d 942 (1978); Estate of Puckett, 11 Cal.App.3d 46 (1980).

Implied TrustsResulting and Constructive (Hower 283)


Involuntary trusts are governed by Civ 2223-2225, relating to:

Wrongful detention of the property of others (Civ 2223).


Gaining property by fraud, accident, mistake, undue influence, breach of trust, or other
wrongful acts (Civ 2224).
Felons who receive money for books, articles, or films regarding their crimes (Civ 2225).

Miscellaneous Trusts (Hower 287)

Spendthrift Trusts (Hower 287)


A beneficiarys interest or the trust principal may be restrained from transfer or protected from
creditors of the beneficiary by express language in the trust. Prob 15300-15303. However, a

34
settlor may not protect himself or herself from claims of his or her own creditors through the
creation of a trust with limiting language of which the settlor is also the beneficiary or over
which the settlor retains a power of revocation. Prob 15304, 18200.
Moreover, (a) claims for spousal or child support for the trust beneficiarys spouse, former
spouse, or minor child; (b) restitution judgments against the beneficiary resulting from felo-
nious conduct by the beneficiary, or (c) liability of the beneficiary for reimbursement for pub-
lic support furnished to the beneficiary or the beneficiarys spouse or minor child may be sat-
isfied from trust principal or interest (notwithstanding restraining language in the trust itself)
either: (1) for present and future payments by court order if the beneficiary has the right un-
der the trust to compel the trustee to pay income or principal to or for the benefit of the bene-
ficiary or (2) for future payments by order of a court, regardless of the beneficiarys power to
direct the trustee. Prob 15305, 15305.5, and 15306.
A court may also order payment of judgment creditors claims against the beneficiary not-
withstanding a restraint on transfer of the beneficiarys interest in the trust. Prob 15306.5, 15307.

Totten Trusts (Hower 288)


Provisions governing Totten Trusts are found in Prob 80 and 5100-5407.

Sprinkling Trusts (Hower 289)


A discretionary power given to a trustee must be exercised reasonably, and not arbitrarily
(Prob 16080). A trustee must act in accordance with fiduciary principles and not in bad faith or
disregard of the purposes of the trust, even where the trust confers absolute, sole, or un-
controlled discretion on the trustee. Prob 16081(a). Moreover, a power to distribute income or
principal to or for the benefit of others may not be used to discharge the legal obligations of
the party holding the power. Prob 16082. If a beneficiary holds a power to take or distribute in-
come or principal of a trust to or for the benefit of himself or herself, the holder of the power
may exercise it only for his or her health, education, support, or maintenance, unless a broader
standard is established in the trust instrument. Prob 16081(b).

LIVING (INTER VIVOS) TRUSTS (HOWER 296)

Revocable Living Trusts (Hower 297)


A trust is presumed to be revocable unless expressly made irrevocable by the terms of the trust
instrument. Prob 15400. A trust may be modified by the consent of all of the beneficiaries if ir-
revocable (Prob 15403), or by consent of the settlor if revocable by the settlor (Prob 15402), or
by consent of the beneficiaries and the settlor (Prob 15404). settlor. Prob 15409.

Disadvantages of a Revocable Living Trust (Hower 305)


The property of a revocable living trust is subject to the claims of creditors of the settlor to the
extent of the power of revocation during the lifetime of the settlor. Prob 18200.
In addition, after the death of the settlor, the property of the trust is subject to creditors claims
in accordance with the provisions of Prob 19000-19403, which provide for the publication and giv-
ing of notice to creditors, acceptance and rejection of creditors claims, barring of claims if not filed
in accordance with the time limits and procedures identified, and division and distribution of the
property of the revocable trust between creditors, the surviving spouse, and other distributees.

35
10 ESTATE PLANNING
AND LONG-TERM CARE

The principles enunciated in the text are representative of California practice.

36
11 PERSONAL REPRESENTATIVES:
TYPES, PRE-PROBATE DUTIES,
AND APPOINTMENT

TYPES OF PERSONAL REPRESENTATIVES (HOWER 360)


In California, an executor is a person named in a will by a decedent to administer the estate
and carry out the terms of the will. Prob 8420, et seq. If it appears from a will that a person was
intended by the decedent to administer the estate, but the person was not named specifically
as an executor, then the person will be entitled to appointment as a personal representative as
though he or she had been named executor. Prob 8421. Moreover, a will may designate another
to appoint an executor, a co-executor, or a successor executor or co-executor. Such an appoint-
ment in writing and filed with the court will be given the same effect as if the testator had
named an executor in the will. Prob 8422.
An administrator with the will annexed is appointed where the decedent died testate
(having written a will) but no executor was named in the will or all named in the will as ex-
ecutors were unwilling or unable to assume that role (Prob 8440) and an administrator with
the will annexed has the same authority over the decedents estate as an executor named in the
will would have. Prob 8442.
Priority for appointment as administrator with the will annexed is the same as priority for
appointment as administrator, explained below, except that a person who takes more than 50%
of the value of the estate under the will, or his or her nominee (or the nominee of a group of
several persons who together take more than 50%) have priority over all others; and those who
take a greater sum under the will or by statutory authority have priority over those entitled to
a lesser sum, or nothing at all. Prob 8441.
An administrator is appointed as personal representative where the decedent died intes-
tate (without a will). Prob 8460(a).
A special administrator is appointed where immediate action is required with regard to
the estate but no permanent personal representative has yet been appointed. Prob 8540(a).
If a person is appointed as an administrator on the ground of intestacy, or an administrator
with the will annexed or executor, and a will or later will, respectively, is subsequently admit-
ted to probate, the appointed personal representative shall be removed from office. Prob 8504.
Priority for appointment as administrator is as follows:

Surviving spouse.
Children.
Grandchildren.
Other issue.
Parents.
Brothers and sisters.

37
Issue of brothers and sisters.
Grandparents.
Issue of grandparents.
Children of a predeceased spouse.
Other issue of a predeceased spouse.
Other next of kin.
Parents of a predeceased spouse.
Issue of parents of a predeceased spouse.
Conservator or guardian of the estate (with qualifications).
Public administrator.
Creditors.
Any other person. Prob 8461.

However, if one with priority fails to claim appointment, the court may appoint any other who
does claim priority for appointment. Prob 8468.
Surviving spouses and relatives have priority only if they are entitled to succeed to some
or all of the estate either directly or through another deceased person, or by will. Prob 8462.
A surviving spouse living separate and apart from the decedent at the time of death who
is a party to an action for dissolution, annulment, or separate maintenance has priority only
next after the brothers and sisters. Prob 8463.
As among those with equal priority, the court may appoint one or more of them and, if they
are unable to agree, the court may appoint the public administrator or a disinterested person
of a lower class. Prob. 8467.
In lieu of himself or herself, one with priority may, in writing, nominate another to act as
administrator. Prob 8465(a). The nominee will have priority equivalent to that of the nomina-
tor (if the nominator is of the class of grandparent or above on the list) but will be chosen next
only after all others of the class of the nominator have declined appointment. Prob 8465(b). If
the nominator is of a lower class, then the court may appoint a person of a class lower than that
of the nominator, rather than appointing the nominee. Prob 8465(c). If the priority of a person
is based solely upon being a creditor, the court may deny the appointment and appoint an-
other, in its discretion. Prob 8466.
A trust company may be appointed as a personal representative in the same manner as an
individual and, if so appointed, may not be required to give a bond. Prob 300, 301.
The court may also appoint a successor personal representative, upon petition with no-
tice and according to the same priorities as the original appointment (Prob 8522), whenever the
office of the personal representative is left vacant by the death, resignation, removal, or other
termination of authority of a personal representative (Prob 8520), and a successor personal rep-
resentative may exercise all of the powers of the personal representatives office. Prob 8524,
8525. During the term of the vacancy, the court may appoint a special administrator. Prob 8523.
Nonresident personal representatives are deemed to have appointed the Secretary of
State, as their attorney permitting service of process and notices upon the Secretary of State on
behalf of the nonresident personal representative, and are required to execute and file with the
court a statement of permanent address and prompt written notification of changes of address.
Prob 8570, et seq.
Prob 8420 identifies those ineligible for appointment as personal representatives, includ-
ing minors, those subject to conservatorship, or nonresidents of the United States.
A personal representative may be removed from office on petition of any interested party on
the ground that the personal representative has wasted, embezzled, mismanaged, or committed
a fraud on the estate, or is about to do so; is incapable of properly executing his or her duties; has

38
wrongfully neglected the estate or has long neglected to perform any act; or must be removed
for the necessary protection of the estate or interested person. Prob 8500, 8502. The court issues
a citation to the personal representative to appear and show cause why the personal representa-
tive should not be removed and, after demur or answer to the petition by the personal represen-
tative and hearing and the taking of evidence, if the court determines that cause exists for re-
moval (and the failure of the personal representative to attend or answer is cause), the court will
remove the personal representative and revoke any letter issued, and appoint a successor per-
sonal representative. Prob 8500-8502, 8520-8525. The court may deny a petition for removal on
the ground that the person seeking appointment has higher priority if the court determines that
the person had knowledge of the prior appointment and an opportunity to contest it and to grant
the petition would be contrary to the sound administration of the estate. Prob 8503.
A personal representative is entitled to compensation according to statute, based upon the
value of the estate, in the same amount as the attorney for the personal representative, as follows:

Four percent (4%) on the first fifteen thousand dollars ($15,000);


Three percent (3%) on the next eighty-five thousand dollars ($85,000);
Two percent (2%) on the next nine hundred thousand dollars ($900,000);
One percent (1%) on the next nine million dollars ($9,000,000);
One-half of one percent (0.5%) on the next fifteen million dollars ($15,000,000); and
A reasonable amount determined by the court for all estates above twenty-five million dol-
lars ($25,000,000). Prob 10800.

A personal representative is also entitled to additional compensation in such sums as the court
determines to be just and reasonable for extraordinary services (Prob 10801(a)) and may em-
ploy tax counsel, auditors, accountants, or other tax experts who may be paid from the estate.
Prob 10801(b).
A special administrator is entitled to compensation as well; however, the special adminis-
trator will not be paid until close of the administration of the estate (absent a petition for ear-
lier payment joined in by the general personal representative) and the total compensation paid
to the special administrator and to the general personal representatives cannot exceed the to-
tal sums set forth in Prob 10800 and 10801. Prob 8547(a) and (b).

PREPARATION FOR PROBATE AND ESTATE


ADMINISTRATIONGENERAL OVERVIEW (HOWER 378)

Pre-probate Duties of the Personal Representative and Paralegal (Hower 379)

Search for and Obtain the Will and Other Personal and Business Records
(Hower 379)
One who is a custodian of a will is required to produce that will to the clerk of the Superior
Court of the county in which the estate of the decedent may be administered within thirty (30)
days of learning of the death of the decedent. The custodian must also mail a copy of the will
within the same time period to any executor named in the will if his or her whereabouts are
known to the custodian, or to the beneficiary of the will, if that persons whereabouts are
known to the custodian. Prob 8200(a). The custodian is liable for any damages caused by his
or her failure to act in accordance with the statute. Prob 8200(b).

39
Records and public papers of a notary public must be delivered to the county clerk on the
death of the notary. Gov 8209.
One who holds a key to a safe deposit box in a financial institution where all owners of the
box are deceased may obtain access to the box by providing the financial institution with proof
of the decedents death by producing a copy of a death certificate or written statement of death
by the treating physician, hospital, coroner, or institution where the decedent died, and rea-
sonable proof of the identity of the person seeking access. Prob 331(a) and (b). Access may be
given under the supervision of an officer or employee of the institution for the purpose of mak-
ing an inventory of the contents of the safe deposit box, removing wills and trust instruments
from the box (placing photocopies of the same in the box), and instructions for the disposition
of the decedents remains. All wills shall be delivered to the clerk of the Superior Court and
copies mailed to the executor or beneficiaries, as previously described. Prob 331(d),(e), and (f).
Government officials, public administrators, law enforcement agencies, employers, or the
hospital or institution in which a decedent died may deliver the tangible personal property of
the decedent to the decedents surviving spouse, relative, or conservator or guardian of the es-
tate, unless the person knows of a dispute regarding the right to possession of the property. In
addition, the delivering party must maintain an inventory of the property delivered and the
identity of the recipient for three years. Prob 330.

Obtain Certified Copies of the Death Certificate (Hower 381)


Copies of the death certificate may typically be acquired from the County Recorders office of
the county in which the death occurred.

The Appointment ProcedureThe Beginning (Hower 384)

Bond (Hower 385)


Pursuant to Prob 8480, a bond is required of all personal representatives prior to the issuance
of letters. If two or more persons are appointed, either a joint bond or separate bonds from each
may be required by the court. Prob 8480(a).
The provision for a bond may be waived either by express provision in a will or by a written
waiver executed by all beneficiaries. Prob 8422(a), 8481(a). In its discretion, however, a court may
disregard the waivers and require the giving of a bond either before or after the issuance of let-
ters for good cause (Prob 8481(b)) or the court may itself waive the giving of a bond. Prob 8543.
The amount of the bond is fixed by the court, but will be no more than the total estimated
value of the estates personal property plus the estimated annual gross income of the estate. If
independent administration of the estate is granted with regard to real property, the estimated
value of the decedents interest in real property is added as well. Prob 8482(a).
A personal representative might also deposit the money and property of the estate with fi-
nancial and trust institutions on condition that the property not be withdrawn except on au-
thorization of the court (Prob 9700) and, if this is done, the value of the bond required may be
adjusted by the court to exclude the value of the property deposited or lowered or reduced to
an amount the court determines to be reasonable. Prob 8483.
The personal representative is annually allowed the cost of the bond. Prob 8486.

Surety (Hower 390)


If the bond is given by an admitted surety insurer, the court may establish a fixed minimum
for the bond equivalent to the minimum premium required by the surety. Prob 8482(b). If the
bond is given by personal sureties, the amount will be doubled. Prob 8482(c).

40
Actions against the sureties on the bond must be brought within four years of the discharge
or removal of the personal representative or within four years from the date the order sur-
charging the personal representative becomes final, whichever is later (Prob 8488(b)), or within
six years from the date of judgment releasing the personal representative and sureties from the
heirs or devisees claims, whichever is later. Prob 7250, 8488(c).

Letters Testamentary and Letters of Administration (Hower 391)


Personal representatives may only exercise authority when appointed, and such an appoint-
ment is not effective until letters are issued to them by the court. Prob 8400(a). Letters are re-
voked upon removal of a personal representative from office. Prob 8501.
Relating to personal representatives, letters may mean letters testamentary, letters of ad-
ministration, letters of administration with the will annexed, or letters of special administra-
tion. Prob 52.
Letters must be signed by the clerk under the seal of the court, and contain:

The county from which the letters are issued.


The name of the personal representative and whether he or she is appointed as an executor,
administrator, administrator with the will annexed, or special administrator.
A notation as to whether the personal representative is authorized to act under the Inde-
pendent Administration of Estate Acts (essentially without court supervision) and, if so,
whether the authority includes or excludes the power to sell, exchange, encumber, or grant
an option to purchase real property. Prob 8405.

41
42
12 PROBATE AND ESTATE
ADMINISTRATION

As in other areas of practice in California, the Judicial Council (a group appointed to study and
make recommendations for the enhancement of the judicial process) has approved or adopted
standard forms for use in probate matters. Use of approved forms is generally discretionary,
whereas use of adopted forms is mandatory. However, even if a specific form has not been
adopted, its use may be required by local court rule, or local court rule may specify the use of
a particular locally adopted form. If the use of a particular Judicial Council form or of a local
form is not mandatory, office-drafted pleadings may be utilized.
The general rules regarding the procedural aspects of estate administration, petition
process, giving of notice, filing and setting matters for hearing, conduct of hearings and orders,
citations, and so forth, are found at Prob 1000-1265.

PROBATE OR ESTATE ADMINISTRATION (HOWER 396)

Small Estate Settlement and Administration (Hower 398)


Depending upon the size and composition of the estate and the marital status of the decedent,
different methods exist in California for the summary passing of title to estate property to the
decedents successors or surviving spouse and children without administration.

Collection by Affidavit (Hower 398)


For Personal Property (Hower 398)
One provision for small estate settlement and administration is applicable to estates with a
gross value of real and personal property in California not exceeding $100,000. Prob 13100. In
calculating the gross value of the estate as of the date of death, the following are excluded:

Property in which the decedent held a joint tenancy interest.


Property which passed to the decedents spouse.
Property in which the decedent held a life or other interest terminable at the decedents death.
Multiple party or POD accounts which pass to another.
Registered vehicles and vessels.
Registered manufactured homes, mobilehomes, commercial coach, truck camper, and float-
ing homes.
Amounts due the decedent for services in the armed forces.
Salary or other compensation due the decedent, not exceeding $5,000. Prob 13050.

If there is no proceeding for the administration of a decedents estate, or if the personal repre-
sentative of the estate has consented, the successor of the decedent (either a devisee under a

43
will or heir, if the decedent dies intestate (Prob 1006)) may collect money, receive tangible per-
sonal property, or have evidences of a debt, obligation, or chose in action (Prob 13100)but not
real property (Prob 13115)by executing and delivering to the holder of the decedents prop-
erty (Prob 13002) an affidavit or declaration stating:

The decedents name.


The date and place of death.
That At least 40 days have elapsed since the death of the decedent, as shown in a certified
copy of the decedents death certificate attached to this affidavit or declaration.
Either: (1) No proceeding is now being or has been conducted in California for adminis-
tration of the decedents estate.
or (2) The decedents personal representative has consented in writing to the payment,
transfer, or delivery to the affiant or declarant of the property described in the af-
fidavit or declaration.
That The current gross fair market value of the decedents real and personal property in
California, excluding the property described in Section 13050 of the California Probate
Code, does not exceed one-hundred thousand dollars ($100,000).
A description of the property of the decedent to be paid, transferred, or delivered pursuant
to the affidavit or declaration.
The name of the successor of the decedent.
Either that the affiant is the decedents successor or is authorized to act on behalf of the suc-
cessor with respect to the decedents interest in the property.
That no other person has a superior right to the property or interest.
A request that the property be paid, delivered, or transferred to the affiant/declarant.
A verification that the contents of the affidavit/declaration are true and correct. Prob 13101(a).

The affidavit or declaration must have a certified copy of the decedents death certificate at-
tached to it and, if the decedents personal representative has consented, a copy of the consent
and the personal representatives letters must also be attached to the affidavit or declaration.
Prob 13101(d) and (e).
If the decedent held evidence of ownership of the property in question, the evidence of
ownership should also be attached. Prob 13102.
If the decedents estate includes real property located in California, an inventory and ap-
praisal by a probate referee must also be attached to the affidavit or declaration. Prob 13103.
The person presenting the affidavit must also provide reasonable proof of his or her iden-
tity to the holder of the property (Prob 13104) who is bound to release the property to the
presenter if the requirements of Prob 13101-13104 are met, and is subject to an action to re-
cover the property and an award of reasonable attorneys fees to the person bringing the ac-
tion if the refusal to deliver the property was unreasonable. Prob 13105. A holder of property
who releases it pursuant to the statutory requirements is discharged of liability with respect
to the property and released of tax liability and may rely in good faith on the statements in
the affidavit or declaration and has no obligation to inquire into the truth of those state-
ments. Prob 13106.
If the obligation sought to be transferred is secured by a lien on real property and an in-
strument creating the lien has been recorded, then the affidavit shall include a recording ref-
erence to the instrument creating the lien, and a notary publics certificate of acknowledgment
identifying each person executing the affidavit or declaration, and the affidavit or declaration,
must be recorded in the office of the county recorder of that county. Prob 13106.5.

44
The successor of the decedent who has received property is personally liable for the debts
of the decedent to the value of the property received (Prob 13109) and is also liable to any per-
son having a superior right to the property by testate or intestate succession, and is liable for
three times the value of the property if the property was fraudulently secured. Prob 13110.
If the decedent was a party to pending litigation, the successor may be substituted in the
litigation in the place of the decedent. Prob 13107.5.
If proceedings for administration of the decedents estate are commenced and, even if the
personal representative has consented to collection by affidavit, the personal representative
may later request that the property be restored to the estate and anyone who received such
property is liable to return it or its fair market value to the estate. Prob 13111.

For Real Property (Hower 398)


Where the value of real property located in California does not exceed twenty thousand dol-
lars ($20,000), title may be transferred to a successor to the decedent by affidavit filed not less
than six (6) months after the death of the decedent if there is no proceeding for the adminis-
tration of the decedents estate or the personal representative of the estate has consented. The
affidavit must contain:

The name of the decedent.


The date and place of death.
A legal description of the real property.
The interest of the decedent in the property.
The name and address of each guardian or conservator of the decedent at the time of death,
to the extent known.
That the gross value of all real estate owned by the decedent, excluding that identified in
Prob 13050, does not exceed twenty thousand dollars ($20,000).
That at least six months have elapsed since the death as shown in an attached certified copy
of the decedents death certificate.
Either that there is no proceeding to administer the decedents estate or that the decedents
personal representative has consented in writing.
That funeral expenses, expenses of last illness, and all unsecured debts of the decedent have
been paid.
That the affiant is the successor of the decedent in and to the property and that no other per-
son has a superior right to the interest of the decedent in the property.
A verification under penalty of perjury that the contents of the affidavit are true and correct.
Prob 13200(a).

A notary publics certificate of acknowledgment is required for each person signing the affi-
davit (Prob 13200(b)) and an inventory and appraisal by a probate referee must be attached
(Prob 13200(c)) as well as a certified copy of the death certificate, a copy of the will if claiming
under one and no estate proceeding is pending, and a copy of the personal representatives let-
ters and written consent, if applicable (Prob 13200(d) and (e)), as well as a thirty-five dollar
($35) filing fee. Prob 13201.
The affidavit and attachments are filed with the court clerk, who issues a certified copy of
the affidavit (without attachments), which is recorded in the office of the county recorder
where the real property is located, with the decedent indexed as the grantor and the successor
indexed as the grantee of the title to the real property. Prob 13202.
The successor is personally liable to the extent of the fair market value of the property for
the decedents unsecured debts (Prob 13204), and to any person having a superior right to the

45
property by testate or intestate succession, and for three times the fair market value of the
property if acquired fraudulently. Prob 15205. Any action to impose liability must be brought
within three years of the date of the affidavit or of discovering the fraud, and the limitations
period cannot be tolled for any reason. Prob 15205(c).
Upon the request of the personal representative, the property and the net income received
from it, as well as the balance due to satisfy any encumbrance placed upon the property by the
successor, must be restored to the estate of the decedent, or three times the fair market value
of the property if the successor fraudulently executed or filed the affidavit to succeed to the
property. Prob 13206.

Petition for Confirmation (Hower 398)


For estates which do not total in excess of $100,000 in real and personal property, and for which
there has been no administration instituted or if the personal representative has consented not
earlier than forty (40) days after the decedents death, a petition may be filed with the Superior
Court of the county in which the decedents estate may be administered seeking court confir-
mation of the title of the successor of the decedent to an interest in real property (and personal
property). Prob 13151.
The petition must be verified and a court order of confirmation requested, which must con-
tain the facts necessary to determine that it has been filed in the proper county; that the dece-
dents gross estate (less excluded property identified in Prob 13050) does not exceed $100,000;
a description of the real and personal property alleged to pass to the successor; the facts upon
which it is claimed that the described property passes to the successor; a statement that either
there is no administration proceeding or that the personal representative of the decedents es-
tate has consented; whether estate proceedings have been commenced in any other jurisdic-
tion and, if so, where; and the name, address, and relation to the decedent of all heirs, devisees,
executors, trustees, guardians, or conservators of the decedent; as well as attachment of an in-
ventory and appraisal by a probate referee, a copy of a will, if the claim to succession is based
upon one, and the written consent of the personal representative, if given. Prob 13152.
After noticed hearing, the court enters an order describing and confirming the property in
the successor (Prob 13153, 13154). The successor will be personally liable to the value of the
confirmed property, less any liens or encumbrances, for the unsecured debts of the decedent.
Prob 13156.

Spousal Property (Hower 398)


In addition to the foregoing, title property passing by will or by intestate succession to a sur-
viving spouse passes without administration. Prob 13500, et seq.
After forty (40) days after death of a spouse, the surviving spouse (or personal representa-
tive, guardian, or conservator of the estate of the surviving spouse) may sell, convey, lease,
mortgage, or otherwise dispose of community or quasi-community real property, and the title
conveyed is free and clear of the claims of the estate or creditors of the deceased spouse, and
the surviving spouse may record an affidavit setting forth the facts giving the surviving spouse
the right to dispose of the property (Prob 13540), so long as a notice has not been filed by an-
other claiming an interest in the property to be conveyed. Prob 13541.
The surviving spouse is personally liable for the debts of the deceased spouse to the extent
of the value of the decedents community and separate property interests passing to the sur-
viving spouse as well as that portion of the surviving spouses property which is not exempt
from enforcement of a money judgment, less the amount of any liens and encumbrances, and
such debts may be enforced against the surviving spouse to the same extent that they may have
been enforced against the deceased spouse. Prob 13550, 13551, 13554.
In addition, the surviving spouse is liable to any person having a superior right to prop-
erty by testate succession from the decedent and, if proceedings for the administration of the

46
decedents estate are commenced, the surviving spouse is liable for the restitution to the dece-
dents estate of the decedents property, or its fair market value, plus any net income received
from the property. Prob 13561, 13562, 13563. However, claims of superior right to the dece-
dents property are barred three years after the death of the decedent and the limitation period
cannot be tolled for any reason. Prob 13561(b).
The surviving spouse is not liable for any debts of the deceased spouse if the property of the
deceased spouse is administered and, if administered, no claim which has not been asserted
within the claims period can be asserted against the surviving spouse. Prob 13552, 13553.
At any time after the death of a spouse, the surviving spouse may collect, by affidavit,
salary or other compensation owed to the deceased spouse in an amount not to exceed five
thousand dollars ($5,000). Prob 13600.
The affidavit or declaration must be furnished to the employer of the decedent, and must
contain:

The name of the decedent.


The date and place of death.
That the affiant or declarant is the surviving spouse, or guardian or conservator of the es-
tate of the surviving spouse.
That the surviving spouse is entitled to the decedents earnings by will or intestate succes-
sion and that no one has a superior right to those earnings.
That no proceeding for administration of the decedents estate has been instituted.
That earnings of up to $5,000 be promptly paid to the affiant or declarant by Prob 13600-
13605, inclusive.
That no other pending request for earnings of another employer exists.
That no other compensation has been collected (or, if collected, the amount specified).
A request for payment of the salary or compensation, not to exceed $5,000.
A verification under penalty of perjury of the truth of the contents of the affidavit or declaration.
Prob 13601.

Payment pursuant to this provision discharges an employer of liability with respect to the com-
pensation paid (Prob 13603), and refusal to pay subjects the employer to an action for the
amount due, as well as reasonable attorneys fees if the court finds the refusal to pay unrea-
sonable. Prob 13604.

Confirmation of Ownership (Hower 400)


A surviving spouse may petition the Superior Court of the county in which the estate of the
deceased spouse may be administered for confirmation of ownership by the surviving spouse
of property passing to the surviving spouse without administration. Prob 13650, et seq.
The petition must allege that administration of the estate is not necessary, and must set
forth the facts necessary to determine the county in which the decedents estate may be ad-
ministered; a description of the decedents property passing to the surviving spouse without
administration; the facts upon which it is claimed that the property may pass without admin-
istration; a description of any interest in community or quasi-community property which the
court is requested to confirm to the surviving spouse; the name, age, address, and relation to
the decedent of each heir, devisee, executor, and personal representatives of the decedent
known to the surviving spouse; and, if the property is claimed to pass by will, attachment of a
copy of the will to the petition. Prob 13651. Attorneys fees are not allowed, but are subject to
agreement between the petitioner and attorney and, if in dispute, the court may be petitioned
to determine the reasonableness of the fees claimed. Prob 13660.

47
Notice of hearing on the petition is given to all interested persons and, after determination by
the court, an order is entered identifying and confirming property to the surviving spouse and, if
appropriate, identifying that property which is subject to administration or further notice and pro-
ceedings (such as ownership of an unincorporated business) (Prob 13658). Prob 13655-13659.

Small Estate Set-aside (Hower 443)


Where the decedents estate (consisting of personal property located anywhere and real prop-
erty located in California), after deduction of all liens and encumbrances and the value of any
probate homestead under Prob 6520, has a net value of $20,000 or less, the estate may be set
aside to the surviving spouse and minor children by petition filed in the Superior Court of a
county in which the decedents estate may be administered. Prob 6600, et seq.
The petition must be filed by the executor named in the will (if any), the surviving spouse, a
child or its guardian, or the personal representative of the decedents estate, if any, and must con-
tain an allegation that the estate is subject to the small estate set-aside provisions of the Probate
Code and a request for an order setting the estate aside; the facts necessary to determine the
county in which the estate may be administered; the name, age, address, and relation to the dece-
dent of all heirs and devisees of the decedent; a specific description and estimate of value of the
decedents property and a list of all liens and encumbrances at the date of death; a description
and estimate of value of real property located outside of California that passed to the surviving
spouse and minor children; a description and estimate of the value of property that passed to the
surviving spouse and minor children by joint tenancy or joint account; a designation of probate
homestead property which has been set aside; a statement of any unpaid liabilities for expenses
of the last illness, funeral charges, and expenses of administration; and the considerations that
justify disposition of the estate under the small estate set-aside provisions. Prob 6604, 6606.
The petition may be filed anytime before the entry of a final order for distribution of the
decedents estate, and may be filed in a pending proceeding for administration, along with a
petition for probate of the decedents will or for administration of the estate, or (if there are no
other administration proceedings) independently. Prob 6605.
Notice of hearing on the petition must be given to all interested persons and the hearing
must be set at least 15 days after the filing of the petition. If a pending hearing to determine fi-
nal distribution is set for before the hearing on the petition, that hearing will continue to coin-
cide with the hearing on the set-aside petition. Prior to the hearing, an inventory and appraisal
of the estate (prepared as in any other case) must be filed by the petitioner or personal repre-
sentative. Prob 6607, 6608.
If the court determines that it is equitable to do so, it shall order the estate set aside for the
surviving spouse and children, after payment of expenses for the last illness, funeral charges,
or expenses of administration from the estate. The court takes into consideration the needs of
the surviving spouse and children, creditors claims, liens and encumbrances on the property,
and the intent of the decedent and the decedents estate plan as expressed in inter vivos and tes-
tamentary documents, and any other relevant considerations. If the spouse is remarried, it is
presumed that the needs of the spouse do not justify the setting aside of the estate in his or her
favor. The courts order setting aside the estate is final and conclusive, and the person to whom
the property is conferred is subject to personal liability for claims for unsecured debts against
the decedent to the extent of the value of the property as of the date of death, less any liens or
encumbrances. If the court determines not to set aside the estate, the property is subject to ad-
ministration as though no petition had been filed. Prob 6609-6612.

Summary Administration (Hower 400)


Prob 7660-7666 provides for the summary disposition of estates with a total value which does
not exceed $20,000 (without court authorization) or $100,000 (with court authorization), if the

48
public administrator takes possession or control of, or is appointed personal representative of,
the decedents estate. Prob 7660.
The public administrator is authorized to receive the property of the decedent, withdraw
deposits, collect debts, sell property, pay expenses and claims, and distribute property to the
beneficiaries of the decedent (Prob 7661-7663); to file with the court, and retain a copy of for
three years, a statement showing the property which came into the control of the public ad-
ministrator and its disposition (Prob 7665); and to receive compensation of not less than $600
for services. Prob 7666.
Persons to whom property is distributed pursuant to these provisions are personally liable
to the extent of the value of the property, less liens and encumbrances, for unsecured debts of
the decedent. Prob 7664.

FORMS OF PROBATE OR ESTATE ADMINISTRATION


(HOWER 403)
In addition to the methods previously identified (for transfer of property where the estate has
a total value, excluding vehicles and other registered property, of $100,000 or less, or where
there is real property valued at less than $20,000, or where property may be transferred by affi-
davit or declaration, or where spousal property is involved or the estate is valued at less than
$20,000 and may be set aside), California provides for estate administration either as a formal
(supervised) process or by the Independent Administration of Estates Act (Prob 10400, et seq.)
providing the personal representative with either full authority (Prob 10402) to administer the
estate without court supervision (Prob 10401) or limited authority (Prob 10403) to do so, re-
quiring court supervision of specified acts relating to the ownership or sale of real property.
Generally, personal representatives have authority to collect and manage the estate of the
decedent without approval or supervision by the court unless specifically precluded from do-
ing so by statute. Prob 9610. The personal representative may, however, by petition, seek au-
thorization, instruction, approval, or confirmation of the acts of the personal representative, in
the administration, management, investment, disposition, care, protection, operation, or
preservation of the estate, or in the incurring or payment of costs, fees, or expenses. Prob 9611.
Moreover, interested persons may also petition and, upon a showing that if the petition is
not granted the estate will suffer great and irreparable injury, the court may direct the personal
representative to act or not to act concerning the estate, or the court may suspend the powers
of the personal representative if the court deems it necessary to do so to protect the interest of
the petitioner from being jeopardized. Prob 9613, 9614.
Personal representatives may also enter into agreements with parties in dispute to refer the
dispute to the court or, with court approval, to arbitration. Prob 9620, 9621.

COMMENCING PROBATE AND ESTATE ADMINISTRATION


PROCEEDINGS (HOWER 406)

Petition for Probate of a Will or Petition to Prove a Will (Hower 406)


Any interested person may petition for determination of the date and place of the decedents
death and administration of the decedents estate and probate of a will. Prob 8000.

49
An executor named in a will who, without good cause, does not petition for administra-
tion of the estate within thirty (30) days after knowledge of the decedents death can be held
to have waived the right to appointment as personal representative. Prob 8001.
The petition shall contain:

The date and place of death.


The street address and county of decedents residence at the time of death.
The name, age, address, and relation to the decedent of heirs and devisees.
The character and estimated value of estate property.
The name of the person for whom appointment as personal representative is sought.
Prob 8002(a).

A photocopy of the will must be attached as well. If holographic, a typed copy of the will is re-
quired as well and, if in a foreign language, an English translation must be attached. Also, if an
executor is named in the will, the petition must state whether the executor consents to or
waives appointment as personal representative. Prob 8002(b).

Petition for Administration When No Will Exists (Hower 410)


A petition for administration may be filed by any interested person and must contain:

The date and place of death.


The street address and county of decedents residence at the time of death.
The name, age, address, and relation to the decedent of heirs and devisees.
The character and estimated value of estate property.
The name of the person for whom appointment as personal representative is sought.
Prob 8002(a).

Obtain an Order for Hearing the Petition to Prove a Will or for


Administration (Hower 410)
The petition must be set for hearing not less than fifteen (15) days and not more than thirty (30)
days after filing, unless the petitioner requests a longer notice period, in which case the hear-
ing shall be set for not more than forty-five (45) days after the filing of the petition. Prob 8003.
The contents and form of notice of hearing are as prescribed in Prob 8100.

Arrange for Publication of the Notice of Order for Hearing and Affidavit of
Publication (Hower 411)
Notice must be published in a newspaper of general circulation (published at least once a week
in the city where the decedent resided at the time of death) with the first publication at least
fifteen (15) days before the hearing and publication continuing for three publications (with at
least five days between the first and last publication). The notice shall be captioned in 8-point
or larger type and the body in 7-point or larger type, and publication must be proved prior to
the hearing by an affidavit containing a copy of the notice and specifying the facts regarding
publication. Prob 8120-8125.

50
Mail the Notice of Order for Hearing and Affidavit of Mailing Notice to All
Interested Persons Including Creditors / Mail Notice of Rights to the Spouse
and Minor Children and Prepare an Affidavit of Mailing (Hower 411)
The notice must be mailed or personally served upon each heir of the decedent and each de-
visee or executor named in the will, creditors, or interested public entities. Prob 8110, 8112.
If the will contains a provision for a testamentary trust for charitable purposes (other than
a charitable trust with a designated trustee resident in California), notice must also be given to
the Attorney General. Prob 8111.
If the decedent is a citizen of a foreign country who hasnt named an executor, or property
will pass to a citizen of a foreign country, notice must be given to the recognized diplomatic or
consular official of that country maintaining an office in the United States. Prob 8113.

Arrange for the Appearance of Witnesses (Hower 413)


The attendance of witnesses may be compelled by subpoena. CCP 1985, et seq.

PROBATE COURT PROCEDURE (HOWER 416)

Hearing on Petition to Prove the Will or Petition for Administration (Hower 416)
At the hearing, the court may take evidence with respect to the date, place, and manner of
death; the place of domicile and residence at the time of death; the character and value of the
decedents property; and whether a will was left. Prob 8005(a). In addition, the court shall es-
tablish the date and place of death; that the decedent was domiciled or left property in this
State; the existence or nonexistence of decedents will; and service and publication of the no-
tice, as required by statute. Prob 8005(b).
A will may be proved upon evidence of one subscribing witness only, which may consist
of an affidavit of the witness to which a copy of the will is attached or contained in the will it-
self. Prob 8220. If a witness is unavailable, the will may be proved by proof of the handwriting
of the testator and either proof of the handwriting of one witness or receipt in evidence of a
writing reciting facts showing due execution of the will either as a writing in the will signed
by all witnesses or an affidavit of a person with personal knowledge of the circumstances of
the execution. Prob 8221.
If a will is contested, the contestant files an objection to probate of the will with the clerk
of court, who issues a summons and a copy of the summons, and objection is served with no-
tice of the petition for administration of the estate on all interested parties. A written response
(answer or demurrer on any of the grounds available in a civil action) to the objection is re-
quired within thirty (30) days of service of the summons. If the demurrer is sustained, the pe-
titioner may have fifteen (15) days within which to amend the objection; if overruled, the re-
spondent may have fifteen (15) days to answer the objection. Prob 8250, 8251. At the trial on
the will contest, the proponents of the will have the burden of proving its due execution, and
the contestants have the burden of proving the grounds for contest, and the subscribing wit-
nesses and/or other evidence shall be produced and examined. If there is a later will purport-
ing to revoke the contested will which has also been petitioned for probate, the court will first
determine whether the later will is entitled to probate. Prob 8252, 8253.

51
Selection of the Personal Representative (Hower 418)
At the hearing, the court shall appoint a personal representative. Prob 8006. The appointment
of the personal representative identified in the petition may be contested as being without pri-
ority or incompetent to serve as personal representative. If another asserts the right to ap-
pointment as personal representative, the contestant must file a petition and serve notice and
the court will hear the two petitions together. Prob 8004.

Order Admitting the Will or Granting Administration (Hower 418)


At the hearing, if established, the court shall order the will to probate. Prob 8006. Collateral at-
tack on the courts order is not permitted except upon a showing of extrinsic fraud upon the court
or that the order is based on the erroneous determination of the decedents death. Prob 8007.
If the will is contested, the court shall try to determine any contested issues of fact and may
make appropriate orders, either admitting the will to probate or rejecting it, in whole or in part.
Prob 8252(b), 8254.
Within 120 days after a will was admitted to probate, any interested party who was not a
party to a will contest and who had no actual notice of such a contest may petition to revoke
the probate of the will, setting forth in writing the grounds for objection. The process in the
event of a petition for revocation of probate follows that of a will contest. Prob 8270, 8271.
If the court determines that the will should be denied probate, the court will revoke the
probate. Revocation terminates the powers of the personal representative. Prob 8272.

Issuance of Letters Testamentary or Letters of Administration (Hower 421)


A person has no power to administer an estate until the appointment as personal representa-
tive becomes effective (i.e., when the person appointed is issued letters). Prob 8400. Letters are
issued to the appointed personal representative only after the giving of any required bond and
the taking and subscribing by the personal representative of an oath to perform, according to
law, the duties of the office. The oath includes an acceptance of the office and is filed with the
clerk. Prob 8403. In addition, the personal representative (other than a trust company or pub-
lic administrator) must execute and file an acknowledgment of receipt of a statement of the du-
ties and liabilities of the office of personal representative in a form prescribed by the Judicial
Council prior to issuance of letters. Prob 8404.

Notice to Creditors (Hower 424)


In addition to the notice of administration generally required, notice to creditors is required
pursuant to Prob 9050-9054. The form of notice is prescribed in Prob 9052 and must be given
within four (4) months after letters are issued to the first general personal representative. Per-
sonal representatives must give notice within thirty (30) days of personal knowledge of the
creditor if such knowledge comes after (or within thirty days of the expiration of) the four-
month period identified. Prob 9050, 9051. Notice is not required if the creditor has filed a claim
or if the personal representative has received a demand for payment from the creditor which
is treated by the personal representative as a claim. Prob 9053.

Appointment of Trustees and Guardians (Hower 424)


Guardianship and conservatorship are governed by the provisions of Division of the Califor-
nia Probate Code (Prob 1400, et seq.).

52
Order Admitting a Foreign Will to Probate (Hower 425)
California has adopted the Uniform International Wills Act (Prob 6380-6390) as well as provi-
sions relating to the probate of nondomiciliary decedents wills upon petition. Prob 12520-12524.

PROCEDURES BEFORE ESTATE DISTRIBUTION (HOWER 427)

Collect and Preserve the Decedents Assets (Hower 429)


The personal representative has the right to take control of all of the property of the decedents
estate; collect all debts due; receive all rents, issues, and profits; pay taxes; and take all steps rea-
sonably necessary for the management, protection, and preservation of the estate. Prob 9650.
All cash shall be kept in interest-bearing accounts or other investments, unless reasonably
necessary for the orderly administration of the estate. Prob 9652.
The personal representative shall commence and prosecute actions to recover fraudulently
conveyed property, or gifts in view of death. Recovered property is to be sold and applied to
creditors claims. Prob 9653.
The heirs or devisees, alone or jointly with the personal representative, may maintain ac-
tions to acquire title to property or for possession of property. Prob 9654.
A personal representative may vote shares of stock or exercise corporate ownership rights
(Prob 9655); insure estate property (Prob 9657); deposit and withdraw funds (Prob 9700); de-
posit and withdraw personal property (Prob 9701); invest estate money in specific securities,
funds, annuities, options, subscriptions, or exercise the same (Prob 9730-9735); continue the op-
eration of the business of a decedent (Prob 9760); abandon or dispose of personal property not
otherwise specifically devised, upon notice or as approved by the court (Prob 9780-9788); with
court approval, continue as a partner in a partnership (Prob 9761-9763); with court approval,
borrow money and give security interests and encumber property (Prob 9800-9807); compro-
mise or settle claims or actions (Prob 9830); lease property as lessor on a month-to-month basis,
or for not more than a year where the rental does not exceed $5,000 per month. Prob 9941.
With court approval, the personal representative may sell real or personal property, after
public notice and hearing and confirmation (Prob 10000, et seq.); accept deeds in lieu of foreclo-
sure or trustees sales (Prob 9850, et seq.); dedicate, exchange, encumber, lease, or grant options
to, or employ or compensate agents with regard to, real property (Prob 9800-9807, 9900-9983).
Court approval is also required for:

Allowance of compensation to the personal representative.


Allowance of compensation to the attorney for the personal representative.
Settlement of accounts.
Sale, exchange, or grant of an option of property of the estate to the personal representative
or to the attorney for the personal representative.
Allowance, payment, or compromise of a claim of the personal representative of the attor-
ney for the personal representative.
Settlement or compromise of a claim, action, or proceeding by the estate against the personal
representative or the attorney for the personal representative.
Extension, renewal, or modification of the terms of a debt or other obligation of the personal
representative or the attorney for the personal representative owing in favor of the decedent
or the estate.
Prob 10501.

53
Prepare the Inventory (Hower 437)
The personal representative is required to include in the inventory all of the property of the
decedent and to identify, to the extent possible, whether the property is community, quasi-
community, or separate, as well as any debts or demands devised in a will. Prob 8850, 8851.
The personal representative or any interested person may petition the court for issuance of
a citation to any person to answer interrogatories or to appear before the court, or both, con-
cerning the possession or disposition of the decedents property and/or to account for the
same. Prob 8870-8873.
The inventory lists each item separately and the fair market value of the item at the time
of death. Prob 8802.

Prepare an Appraisal (Same Form as for Inventory) (Hower 441)


The appraisal shall be prepared by the personal representative, the probate referee (appointed
by the court), or an independent appraiser. Prob 8900.
The personal representative is authorized to determine the appraisal value of money or
cash items (Prob 8901) and then delivers the inventory to the probate referee, who appraises
all property other than that appraised by the personal representative. Prob 8902. The probate
referee must complete the appraisal within sixty (60) days after delivery of the inventory or re-
port to the personal representative and the court as to why the property has not been appraised
and estimating the time required to complete the appraisal. Prob 8940, 8941.
The probate referee must retain and make available to the personal representative, for a
period of three (3) years, the appraisal reports and backup data used to make the appraisals.
Prob 8909.
Alternatively, the court, for good cause and upon petition by the personal representative,
waives the probate referees appraisal (Prob 8903); or, for unique, artistic, unusual, or special
items, the personal representative may choose to have such items appraised by an indepen-
dent qualified expert by noting that election on the inventory prior to providing it to the pro-
bate referee. The referee may object to the election by petitioning to the court within five (5)
days after receipt of the inventory. Prob 8904.
The personal representative or an interested person may demand an appraisal report, backup
data, or justification of the appraisal of an item from the probate referee, or may file a written ob-
jection to the appraisal with the court, which will be determined by hearing. Prob 8906, 8908.

File the Inventory and Appraisal (Hower 442)


The inventory and appraisal are filed with the court, and served on each person requesting a
special notice, within four (4) months after the first issuance of letters to a general personal rep-
resentative. Prob 8800, 8803.
Failure to file an inventory and appraisal within the time period specified may result in the
court compelling such filing; the removal of the personal representative; and imposition of per-
sonal liability on the personal representative for injury to the estate or an interested person, in-
cluding attorneys fees. Prob 8804.
At the time of filing the inventory and appraisal, the personal representative must also file
a certification that either: (1) the decedent owned no real property in California and therefore
the provisions of R&T 480 do not apply, or (2) a change in ownership statement has been filed
with the county recorder or assessor with regard to each piece of property owned by the dece-
dent at the time of death. Prob 8800(d).

54
Procedures for Collecting Specific Estate Assets (Hower 442)
A preliminary change in ownership form must be filed (along with a notification of death of
the real property owner) for each piece of real property owned by the decedent at the time of
death, in each county in which real property is located. R&T 480.
Sales of real property, whether private or public, with or without notice, requiring court
confirmation are provided for in Prob 10300, et seq. Notice of sale is generally required, unless
a direction or authority to sell the property is contained in a will. Sale may be public or private
and confirmed by the court. If privately sold, an appraisal is required and the bid is at least 90%
of the appraised value. At the confirmation hearing, the court may confirm the sale on the
submitted bid, or accept new bids for the purchase (the new offer must be at least 10% higher
on the first $10,000 and 5% more on the amount bid in excess of $10,000), or order a new sale.
Sales of personal property are covered in Prob 10250, et seq. Generally, notice of sale is re-
quired either by posting or publication, and sales must be confirmed by the court, unless ex-
empt, after hearing. At the hearing, new bids which are 10% more than the bid at sale may be
made and accepted by the court, or the court may order a new sale.

Sales of securities are found at Prob 10200, 10202.


Saving accounts and mutual capital certificates appear in Prob 10201.
Sales of leasehold interests are dealt with in Prob 10203.
Partnership interests may be sold in the same manner as personal property. Prob 10204.
Contracts for the purchase of real property are addressed at Prob 10206.

DISTRIBUTION OF THE ESTATE AND PAYMENT OF CLAIMS


(HOWER 442)

Distribution of Family Allowances to a Surviving Spouse and/or Minor


Children (Hower 443)
Please refer to the prior discussions of family allowances, small estate set-aside, probate home-
stead, and marital property.

Filing and Hearing of Creditors Claims and Payment of Allowed Claims


(Hower 443)
Creditors claims must be filed with the court (and a copy mailed to the personal representa-
tive), or forever be barred, within four (4) months after the first issuance of letters to a general
personal representative, or within thirty (30) days of notice of administration given to the cred-
itor, whichever is later. Prob 9002, 9100, 9150. The time period may be extended by the court,
upon petition by the creditor, if the creditor (or its attorney) received notice less than fifteen
(15) days before the close of the four-month notice period or the creditor had no knowledge of
the existence of the claim until less than fifteen (15) days before the close of the claim period,
and the petition for extension was filed within thirty (30) days after knowledge by the credi-
tor. In no event, however, can the period for the filing of a claim be extended beyond the ear-
lier of either: (1) one year after the first issuance of letters to a general personal representative
or (2) the time the court makes an order for final distribution of the estate. Prob 9103.

55
A claim must be supported by the affidavit of the creditor: that it is a just claim; setting
forth the facts supporting the claim, the amount of the claim, and that all offsets and amounts
have been credited; if the claim is not due or contingent or the amount not yet ascertainable,
the facts supporting the claim; and, if not made by the creditor, the reason why the affidavit is
not made by the creditor. Prob 9151(a). The personal representative may also require satisfac-
tory vouchers or proof to support the claim. Prob 9151(b).
If the claim is based on a written instrument, an original or copy of the instrument should
be attached or, if a recorded document, a recording reference provided. Prob 9152.
Claims by public entities are addressed at Prob 9200-9205.
The personal representative either allows or rejects claims in whole or in part, in writing,
setting forth the pertinent information regarding the claim and its rejection or allowance and
informing the creditor, if rejected, that it has three (3) months in which to act on a rejected claim,
and filing the allowance or rejection with the court and giving notice to the creditor of the
same. Prob 9250.
If the personal representative is not authorized to act under the Independent Administra-
tion of Estates Act, all allowed claims must be submitted by the clerk to the court for approval
or rejection and the court may examine the creditor and receive evidence to determine the va-
lidity of the claim prior to endorsing on the claim whether it is approved or rejected by the
court. Prob 9251. The refusal or neglect of the personal representative or judge to allow or re-
ject a claim within thirty (30) days of the filing of the claim may be treated by the creditor as a
rejection of the claim. Prob 9256.
Claims by the personal representative, or the attorney for the personal representative, must
be submitted to the court and, in the courts discretion, may require a petition and noticed
hearing. Prob 9252.
The allowance of a claim may be contested by any interested party. Prob 9254.
Creditors may contest the rejection of claims, in whole or in part, by bringing an action on
the claim. Prob 9255, 9350, et seq.
Claims established by judgment after the death of the decedent are payable as claims in the
ordinary course of administration of the estate, and not pursuant to the Enforcement of Judg-
ments Law (CCP 680.010, et seq.). Prob 9300.
An action pending against the decedent at the time of death cannot be continued and no
recovery is allowed against property of the decedents estate unless a claim is first filed, is re-
jected, and within three (3) months after the rejection the claimant applies to the court in which
the action is pending for substitution of the personal representative for the decedent as a party
in the action. Prob 9370. Similarly, an action cannot be filed against a decedents personal rep-
resentative until a claim has been first filed and rejected, and the applicable statute of limita-
tions is tolled during the pendency of the claim until it is allowed or rejected. Prob 9350-9352.
Debts are to be paid in the following order of priority (except that debts owed to the United
States and this State that have preference under the law shall be given that preference):

Expenses of administration.
Funeral expenses.
Expenses of last illness.
Family allowance.
Wage claims.
Obligations secured by mortgage, deed of trust, or lien.
General debts.
Prob 11420(a).

56
No debts of any class may be paid until all debts of the prior class have been satisfied and, as
between debts of a class, no priority is given and all receive a proportionate share if the estate
is insufficient to satisfy the full amount of all debts of the class. Prob 11420(b).
As soon as there are sufficient funds to cover the costs of administration, funeral expenses,
expenses of last illness, family allowance, and wage claims are to be paid. All other debts are not
required to be paid until ordered by the court. Interest accrues on debts at the legal, or contracted,
rate until paid from the date of order for payment (or as specified by contract). Prob 11421-11423.

THE FINAL ACCOUNT AND CLOSING THE ESTATE


(HOWER 454)

File the Final Account and Petition for Settlement and Distribution/Request
Order for Hearing on Final Account and Petition for Distribution (Hower 455)
The personal representative or an interested party may petition for final distribution of the
decedents estate (Prob 11600) when all debts have been paid or provided for, or if the estate is
insolvent, and the estate is in a condition to be closed. Prob 11640.
A final account must be filed when the estate is in a condition to be closed. Prob 10951. An
account must also be filed when it has been more than one year since the issuance of letters, or
more than one year after the filing of the last account, on the petition of an interested person
or the courts own motion, and not more than sixty (60) days after the termination of the per-
sonal representatives authority. Prob 10950. The account must include both a financial state-
ment and report of administration, including (with supporting schedules) a summary state-
ment of the property in all inventories; receipts; gains on sales; acquisitions of property;
disbursements; losses on sales; other dispositions of property; property on hand; and the lia-
bilities of the estate, including creditors claims (whether notice to creditors was given; the
amounts, names, dates of filing and action taken on claims; and claims not paid, satisfied, or
adequately provided for and, if secured, the nature of the security). Prob 10900.
A petition for an order for final distribution of the estate or a report on the status of the
estate must be filed no later than one year (if no federal estate tax return is required) or eight-
een (18) months (if a federal estate tax return is required) after the date of issuance of letters.
Prob 12200.
If the personal representative fails to petition or report within the time limits required, the
court may cite the personal representative and either order the personal representative to file
the petition or order the continued administration of the estate. If the personal representative
fails to comply with that order, the personal representative may be removed from office by the
court. Prob 12202, 12204.
The filing of a final account, and such other accounts as may be required, is governed by
the provisions of Prob 10900, et seq.

Give Notice of the Hearing to Interested Parties (Hower 455)


Notice shall be given to all interested parties, to the Attorney General if some portion of the
estate would escheat to the State, and to the Controller if property is to be distributed to the
State because there is no known beneficiary or if the beneficiarys whereabouts are un-
known. Prob 11601.

57
Prepare and File Copies of Federal and State Estate and Income Tax
Returns with the Final Account (Hower 455)
Required California tax returns may include the final personal income tax return for the dece-
dent, the estate (fiduciary) income tax return, and the California estate tax return.

Hearing on the Final Account and Petition for Distribution/Request Order


Allowing Final Account (Hower 455)
The personal representative or any interested party may oppose the petition. Prob 11602.
If the court determines that the conditions for distribution are satisfied, it will order dis-
tribution of the estate to the persons entitled to it, naming the distributees and their shares; and
identify the limitations or conditions accompanying the property, if any. Prob 11603. If distri-
bution is to be made to a person other than a beneficiary, the court may inquire into the cir-
cumstances, consideration, and execution of the transfer and may refuse to order distribution
or may order distribution on such terms as the court deems just and equitable if it finds the
transfer was obtained by fraud, duress, or undue influence or that the consideration paid to or
by the beneficiary was grossly unreasonable. Prob 11604.
At a hearing for final distribution or for allowance of compensation, the court may also re-
duce the compensation of the personal representative or the attorney for the personal repre-
sentative if it determines that the time taken for administration exceeds the time permitted by
statute or prescribed by the court, that the delay was within the control of the personal repre-
sentative, and that the delay was not in the best interest of the estate (even if the reduction
would cause the resulting compensation to not be reasonable compensation for the services
rendered). Prob 12205.
If two or more beneficiaries are entitled to the distribution of undivided interests in prop-
erty but cannot come to an agreement as to the allotment or partition, the court may be peti-
tioned to partition or divide the property between them. Prob 11950 et seq.

Compute and File State Inheritance Tax Return or Waiver (Hower 456)
If the estate has a gross value exceeding $400,000, and assets of $100,000 or more will be dis-
tributed to beneficiaries outside of California, a California Income Tax Clearance must be ob-
tained from the California Franchise Tax Board.

Receive Order for Settlement and Decree of Distribution (Hower 456)


The personal representative may immediately distribute the property to the persons entitled
to distribution without further notice or hearing when an order settling the final account and
for final distribution is entered. Prob 11641.

Collect Receipts for Assets by Distributee (Hower 456)


The personal representative shall obtain receipts from distributees of estate property in accor-
dance with the terms of the final order for distribution of the estate. With regard to real prop-
erty, the recordation of the court order for distribution or the personal representatives deed
conveying the property in the county in which the real property is located is deemed to be a
receipt of the distributee for the property. Prob 11750, 11751.

58
If the distributed property is subject to a life estate only in the distributee, the personal rep-
resentative must demand and receive an inventory of the property from the distributee, copies
of which are filed with the court and sent to the remainder distributee. Prob 11752.

File Petition for Discharge of Personal Representative/Request Order


Discharging Personal Representative (Hower 457)
A petition for an order discharging the personal representative may be made ex parte after the
filing of all receipts (or excuse from filing as provided in Prob 11753 after reasonable effort to
obtain a receipt after delivery of the property) in compliance with the order for final distribu-
tion. Prob 11753, 12250.
A personal representative may also petition for discharge and an order terminating the
proceeding at any time, even before issuance of letters, when it appears that there is no prop-
erty of any kind belonging to the estate subject to administration. Prob 12251.

SPECIAL PROBATE PROCEEDINGS (HOWER 457)

Special Administration (Hower 457)


Special administration, and appointment of a special administrator, may be made at any time
the court deems it necessary, with or without notice, with or without bond, in the courts dis-
cretion. Prob 8540-8543.
A special administrator must take the oath and, if the special administrator was appointed
to undertake a particular act or exercise certain authority, letters issued must indicate a nota-
tion of the particular act or authority the special administrator was appointed to undertake.
Prob 8542.
A special administrator may exercise statutorily granted general authority, unless limited
by the letters issued, and the powers of a special administrator cease upon issuance of letters
to a general personal representative or as otherwise directed by the court. Prob 8544-8546.

Administration of Omitted Property (Hower 458)


If subsequent administration of an estate is required because other property is discovered or
for any other reason, the court, after noticed hearing, will appoint a personal representative in
the same order of priority as previously appointed, except that the person who served as per-
sonal representative previously at the time of the order of discharge has priority, and the court
may require a supplemental account and make further instructions or orders relating to the
property. Prob 11642, 12252.

Decree of Descent (Hower 458)


A petition to determine the persons entitled to distribution of the decedents estate and in-
cluding the basis for any claim of entitlement may be filed by the personal representative or
any interested person at any time after letters are first issued to a general personal representa-
tive. Prob 11700.

59
Notice of the hearing on the petition must be given to all interested persons (including the
Attorney General if any portion of the estate is the escheat to the State) and any interested per-
son or person claiming an interest in the decedents estate may appear and file a written state-
ment identifying the claim made or opposing the petition. If a person does not file a statement,
he or she is precluded from further participation in the proceeding, but there is no adverse im-
pact on his or her interest in the estate. The court, after considering the statements and evi-
dence at the hearing, will enter a final order determining the persons entitled to distribution
of the decedents estate and specifying their shares. Prob 11701-11705.
One who feloniously and intentionally kills a decedent is precluded from receiving prop-
erty from the decedents estate, either by testate or intestate succession. Prob 250. Similarly, a
joint tenant who feloniously and intentionally kills his or her co-tenant severs the joint tenancy
relationship so that the share of the decedent passes as the decedents property and there is no
right of survivorship. Prob 251. Named beneficiaries of bonds, life insurance policies, or other
contractual arrangement, or any other person who acquires property or an interest in property
through a felonious and intentional killing of the decedent, also forfeit any right to proceeds
or property resulting from the death of the decedent, and may not bring an action for the
wrongful death of the decedent or benefit from such an action. Prob 252, 253, 258. A final judg-
ment of conviction of felonious and intentional killing is conclusive. Prob 254.

LIMITATIONS ON AND LIABILITY OF THE PERSONAL


REPRESENTATIVE (HOWER 459)
A personal representative is required to use ordinary care and diligence in the management
and control of an estate. Prob 9600.
If a personal representative breaches a fiduciary obligation, he or she is liable for loss or de-
preciation in value resulting from the breach, with interest; profit made through the breach by
the personal representative, with interest; or profit that would have accrued to the estate, but
for the breach. Prob 9601(a). If, however, the personal representative acted reasonably and in
good faith under the circumstances as known, the court may excuse the personal representa-
tive in whole or in part from liability, if it is equitable to do so. Prob 9601(b).
A personal representative is also personally liable (and liable on his or her bond) for:

Failure to pay debts ordered (Prob 11424).


Failure to file an inventory and appraisal as required (Prob 8804).
Contractual obligations on which he or she did not reveal his or her status as personal rep-
resentative (Prob 9606).

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61
62
64
65
66
67
68
71
73
74
75
82
83
84
85
86
87
13 INFORMAL PROBATE
ADMINISTRATION

THE CHOICE OF FORMAL OR INFORMAL PROBATE


(HOWER 466)
Informal probate in California is governed by the provisions of the Independent Adminis-
tration of Estates Act (Prob 10400, et seq.) (IAEA). Absent a restriction in the will of the
decedent which does not permit the independent administration of the estate (Prob 10404)
or objection by an interested person based on a showing of good cause (Prob 10452), admin-
istration with full authority (without court supervision) or with limited authority (with lim-
ited court supervision) will be granted by the court upon petition by the personal represen-
tative. Prob 10450.
Limited authority means the authority to administer the estate including all powers except
the power to:

Sell real property.


Exchange real property.
Grant an option to purchase real property.
Borrow money with the loan secured by an encumbrance upon real property.
Prob 10403.

PRIORITY OF PERSONS SEEKING APPOINTMENT AS


PERSONAL REPRESENTATIVES (HOWER 468)
The priority for appointment as personal representative does not change under the Indepen-
dent Administration of Estates Act.
A special administrator may be granted authority if the special administrator is appointed
with, or has been granted, the powers of a general personal representative. Prob 10405.

APPLICATION FOR INFORMAL PROBATE AND APPOINTMENT


OF PERSONAL REPRESENTATIVE (HOWER 468)
A petition for independent administration is included in the petition for appointment of the
personal representative in a separate petition, requesting either full or limited authority.
Prob 10450.

94
NOTICE REQUIREMENTS (HOWER 472)
Notice requirements are as for the petition for appointment of the personal representative pre-
viously described, but must include in substance a statement that:
The petition requests authority to administer the estate under the Independent
Administration of Estates Act. This will avoid the need to obtain court approval for
many actions taken in connection with the estate. However, before taking certain ac-
tions, the personal representative will be required to give notice to interested persons
unless they have waived notice or have consented to the proposed action.
Independent administration authority will be granted unless good cause is shown
why it should not be. Prob 10451.
At the hearing, an interested person may object to appointment. Unless good cause is shown
why the estate should not be administered independently, the court will grant the requested
authority. If good cause is shown, the court may either deny independent administration, or
grant it with only limited authority. Prob 10452.
If the personal representative is granted only limited authority, a bond amount will be
fixed in the sum of the value of the personal property and annual gross income; if granted full
authority, the bond amount will be the foregoing plus the value of any real property in the es-
tate. Prob 10453.
Upon petition by an interested person, notice of the hearing (which is not less than fifteen
(15) days after its filing), for good cause shown the authority of the personal representative,
may be revoked or limited by the court. In either event, the personal administrators letters are
revoked; in the former case, a new personal representative issued a new letter, and in the lat-
ter, new letters are issued to the existing personal representative.

DUTIES AND POWERS OF THE PERSONAL


REPRESENTATIVE IN INFORMAL PROBATE (HOWER 475)
The personal representative has full authority to administer the estate (to the extent authority
has been granted to do so in the letters issued) without court supervision, subject to express re-
striction in a will, if any (Prob 10502). Prob 10500(a).
The personal representative, if granted full authority, is not required to abide by restric-
tions as to public versus private sales of property, sales with or without notice, court confir-
mation of sale, or rules regarding the minimum acceptable value received for property sold.
Prob 10503. However, the personal representative may also seek and obtain court supervision
at any time for any act (Prob 10500(b)), and is required to obtain court supervision for:

Allowance of compensation to the personal representative.


Allowance of compensation to the attorney for the personal representative.
Settlement of accounts.
Sale, exchange, or grant of an option of property of the estate to the personal representative
or to the attorney for the personal representative.
Allowance, payment, or compromise of a claim of the personal representative of the attor-
ney for the personal representative.
Settlement or compromise of a claim, action, or proceeding by the estate against the personal
representative or the attorney for the personal representative.

95
Extension, renewal, or modification of the terms of a debt or other obligation of the personal
representative or the attorney for the personal representative owing in favor of the decedent
or the estate.
Prob 10501.

Notification of Devisees or Heirs and Creditors (Hower 475)


A personal representative must give notice to interested parties of the following actions
(Prob 10510):

Sale or exchange of real property (Prob 10511).


Sale incorporation of business (Prob 10512).
Abandonment of tangible personal property (Prob 10513).
Borrowing or encumbering property (Prob 10514).
Granting options to purchase real property (Prob 10515).
Transferring property to optioners in will (Prob 10516).
Conveyances by contract with the decedent (Prob 10517).
Determining claims to property (Prob 10518).
Making disclaimers (Prob 10519).
Making preliminary property distributions (Prob 10520).

Notice of the following actions may be required under certain circumstances (Prob 10530):

Entering into contracts which cannot be fully performed by their terms within two (2) years,
unless the personal representative has an unrestricted right to terminate the contract within
two (2) years (Prob 10532).
Investing in securities maturing more than one year from the date of investment (Prob 10533).
Continuing as a general partner for more than six (6) months after the date of the first is-
suance of letters (Prob 10534).
Making the first payment of a family allowance or increasing the payment of a family al-
lowance (Prob 10535).
Leasing real property to another for a term in excess of one year (Prob 10536).
Selling or exchanging personal property (except securities generally) (Prob 10537).
Granting an extension of an exclusive right to sell real property to a broker which exceeds 270
days from the date of the first grant (Prob 10538).

And, no notice is required in the following situations (Prob 10550):

Exercising any powers otherwise not requiring court approval under the Probate Code
(Prob 10551).
Allowance, payment, acceptance, rejection, compromise, settlement, or release of any claim
against the estate or the personal representative (Prob 10552).
Commence, maintain, and defend actions (Prob 10553).
Extend, renew, and modify obligations owing to the decedent or estate (Prob 10554).
Transfer or convey property to carry out a granted specific power (Prob 10555).
Pay taxes, assessments, and expenses incurred in administration (Prob 10556).
Purchase annuities (Prob 10557).

96
Exercise options (Prob 10558).
Purchase securities to perform decedents contract of sale (Prob 10559).
Hold securities in the name of a nominee (Prob 10560).
Exercise subscription or conversion rights (Prob 10561).
Repair and improve real and personal property (Prob 10562).
Accept deeds or deeds in trust in lieu of foreclosure (Prob 10563).
Give partial satisfactions or reconveyances under deeds of trust (Prob 10564).

Where notice is required, it must be given to each known devisee or heir, and all who have re-
quested special notice and the Attorney General if any part of the estate may escheat (Prob 10581)
by personal service or mail at least fifteen (15) days prior to the date of the proposed action spec-
ified in the notice (Prob 10586); however, notice need not be given to any who have consented to
the proposed action in writing or who have waived notice in writing either before or after the
proposed action has taken place. Prob 10581-10583.
The notice must specify:

The name and address of the personal representative.


The person and telephone number to call for further information.
The proposed action (if regarding real property, the material terms of the proposed pur-
chase, sale, option, and brokerage arrangement and fees).
The date on which the proposed action will be taken.

and must contain a form for objecting to the proposed action. If the Judicial Council form of
notice is not used, the notice used must be in substantially the same form as the Judicial Coun-
cil form. Prob 10585.
If a party objects to the proposed action, it must submit its written objection to the personal
representative delivered or received on or before the date of the proposed action in the notice
or the action itself, whichever is later. Prob 10587. Alternatively, an objecting party may seek a
restraining order from the court prohibiting the personal representative from undertaking the
action. Prob 10588. If a party does not object, seek a restraining order, consents, or waives no-
tice, it cannot later seek court review of the proposed action, absent a showing of incapacity
and lack of notice. Prob 10590.
If an action is one for which court supervision would otherwise be required absent the au-
thority granted under the IAEA, the personal representative must seek court supervision. If the
act is one for which no court supervision would otherwise be required, the personal represen-
tative is required to seek court instruction. The personal representative can only undertake the
proposed action in accordance with the terms of the courts order or instruction. Prob 10589.
No action undertaken by the personal representative in violation of the previous provi-
sions is invalid with regard to bona fide purchasers or the rights of third parties dealing in
good faith with the personal representative (and there is no duty to inquire of the personal rep-
resentatives authority or compliance) (Prob 10591); however, the court may itself give the re-
quired notice and the personal representative is subject to removal from office. Prob 10592.

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98
99
14 TAX CONSIDERATIONS IN
THE ADMINISTRATION OF
ESTATES

INTRODUCTION TO TAX CONCERNS (HOWER 490)


California imposes no inheritance, gift, succession, or legacy tax. R&T 13301.
The provisions governing the estate tax may be found in R&T 13301, et seq., and the State
Controller is responsible for administering the estate tax provisions. R&T 14101.
Californias estate tax is a pickup tax. The state estate tax imposed is equal to the por-
tion, if any, of the maximum allowable amount of the credit for state death taxes allowable un-
der federal estate tax law, which is applicable to property located in California. R&T 13302.
Thus, the California estate tax is due only when there is a credit allowed for payment of state
death taxes on the federal estate tax due. If there is no federal estate tax payable, there will be
no California estate tax payable.

AN OVERVIEW OF THE TAX CHANGES OF 1976, 1981, AND


1986 GENERAL TAX CONSIDERATIONS (HOWER 493)
If an instrument includes a formula intended to eliminate the federal estate tax, or refers to a
maximum fraction or amount that will not result in a federal estate tax, the formula shall be
applied to eliminate, not increase or reduce to the maximum extent possible, the federal estate
tax. Prob 21503.

The Marital Deduction (Hower 498)


Marital deduction trusts are to be construed to comply with the provisions of federal law, un-
less the instrument provides a different disposition that qualifies for the marital deduction.
Prob 21520-21526.
If an instrument contains a marital deduction gift, the provisions of the instrument shall be
construed so as to comply with the marital deduction provisions of the Internal Revenue Code
and no fiduciary shall take any action or have any power which impairs the deduction as ap-
plied to the marital gift deduction, which may be satisfied only with property which qualifies
for the marital deduction. Prob 21522.
If an instrument evidences an intent to make a gift that will provide the maximum allow-
able marital deduction, the instrument passes to the recipient an amount equal to the maxi-
mum amount of the marital deduction that would have been allowed as of the date of the gift
under federal law. Prob 21523.

100
Creation of Trusts (Hower 499)
Instruments evidencing an intent to create a charitable remainder unitrust or a charitable lead
trust shall be construed to comply with the applicable provisions of the Internal Revenue Code
and in no event shall the fiduciary take an action or have a power that impairs the charitable
deduction. Prob 21540, 21541.

Generation-Skipping Transfers and Their Tax Consequences (Hower 504)


Provisions regulating generation-skipping transfers and their taxation are found in R&T
16700, et seq.

TAX RETURNS (HOWER 506)

Decedents Final Income Tax Returns, Federal and State (Hower 507)

State Individual Income Tax Return (Hower 508)


The decedents final state income tax return (Form 540) is due when it would otherwise have
been due had the decedent not died.
Applicable provisions regarding individual income tax for estates, trusts, beneficiaries,
and decedents are found in R&T 17731-17779.

Fiduciarys Income Tax Returns, Federal and State (Hower 509)

State Fiduciary Income Tax Return (Hower 511)


State income taxes are due if the gross income of the estate during administration exceeds
$7,000, or if the net income exceeds $1,000. Returns (Form 541) may be filed on a calendar or
fiscal year basis, regardless of the decedents filing period.

State Inheritance and Gift Tax Return (Hower 512)


Effective January 1, 1981, California abolished its pre-existing inheritance and gift tax schemes.

Decedents Estate Tax Returns, Federal and State (Hower 512)

State Estate Tax Return (Hower 525)


The state estate tax return (acquired from the State Controllers office) is due on or before the
date of filing the federal estate tax return (R&T 13501) and an extension for filing the federal
return will similarly extend the time period for filing the state return. R&T 13502.

101
15 ETHICAL PRINCIPLES
RELEVANT TO PRACTICING
LEGAL ASSISTANTS
(HOWER 529)

The discussion in the text is equally applicable to practice principles in California; however,
the licensing and practice of attorneys in California are governed by the provisions of the Cal-
ifornia Business & Professions Code, section 6000, et seq., and the ethical rules are contained
in the California Rules of Professional Conduct, with which the paralegal should be inti-
mately familiar.
In addition, the California paralegal may also be bound by the ethical rules or code of a
professional organization of which he or she may be a member, including national, local, and
statewide associations. The California Alliance of Paralegal Associations, an organization
made up of many local paralegal associations in California, has adopted an ethical code, as
have many of the local associations which make up its membership.

102