March 2019 Update
The California Supreme Court approved a comprehensive revision to the Rules of Professional Conduct. The revised rules were effective November 1, 2018. Throughout the book, references have been updated. In some instances, the revised Rules add new requirements. For example, a fee-splitting agreement between attorneys must be in writing; client consent must be obtained either at the time the lawyers enter into the fee-splitting agreement or “as soon thereafter as reasonably practicable.” Cal Rules of Prof Cond 1.5.1(a). See §§4.25, 8.19, 11A.10, 23.1, 3.31, 21.76.
The Tax Cuts and Jobs Act (Pub L 115–97, 131 Stat 2054) was signed into law on December 22, 2017, and has sweeping changes relating to income taxes, but only affects the estate, gift, and generation-skipping transfer tax by an increase in the applicable exclusion amount (AEA) to $11.40 million for the year 2019. The AEA will continue to be adjusted through 2025, but in 2026, it will revert back to the provisions under the American Taxpayer Relief Act of 2012. The maximum estate and gift tax rate remains at 40 percent. See §§4.17Z, 4.17BB, 12.8.
Yeh v Tah (2017) 18 CA5th 953 clarified which statute of limitations controls (CCP §§366.2 and 366.3 or Fam C §1101(d)(2)) when one spouse brings a claim for breach of fiduciary duty against a deceased spouse under Fam C §1101(a). Under Fam C §1101(d)(2), breach of fiduciary duty claims filed after the death of a spouse are governed only by equitable principles of laches. See §§4.18, 5.34, 15.31, 19.5.
A petitioner against whom a no-contest clause is being enforced may be able to use California’s anti-SLAPP statute. Urick v Urick (2017) 15 CA5th 1182. For example, a beneficiary could contest the validity of a trust amendment that reduced that beneficiary’s share of the estate. The trustee could then file a petition to enforce the trust amendment’s no-contest clause, and the beneficiary could counter with an anti-SLAPP motion. If successful, the beneficiary’s anti-SLAPP motion would result in the early dismissal of the no-contest clause claim. At least one court has found the anti-SLAPP statute to apply in such a situation, though the “trustee” in that case was able to rebut the motion by showing a probability that he would prevail on the claim. See §§5.5A, 15.17.
The court in Lane v Bell (2018) 20 CA5th 61 made clear that to succeed in a malicious prosecution action the plaintiff must show that the prior action was commenced by or at the direction of the present defendant and terminated in the present plaintiff’s favor. To satisfy the favorable-termination element, the plaintiff in the malicious prosecution action must show the favorable termination of the entire action and not merely some part thereof. See §5.64.
When the attorney-in-fact enters into an arbitration agreement for the principal, the attorney-in-fact does not thereby agree to arbitrate whatever individual claims the attorney-in-fact might have. See Avila v Southern Cal. Specialty Care, Inc. (2018) 20 CA5th 835. See §§8.17, 15.28.
An attorney-in-fact with statutory form power of attorney under Prob C §4401 rather than health care power of attorney under Prob C §4671 lacks authority to bind the principal to arbitration clause when admitting her to residential care facility, since it is a “health care decision.” Hutcheson v Eskaton FountainWood Lodge (2017) 17 CA5th 937. See §8.17.
It is against public policy for a trust to allow a former trustee to withhold communications with the trust’s legal counsel from a successor trustee (i.e., to withhold communications that were administrative in nature and not “defensive advice” as described above), and thus any such provision in the trust is unenforceable. Morgan v Superior Court (2018) 23 CA5th 1026. See §§10.76, 14.21, 21.50A.
Case law also holds that when the attorney-in-fact enters into an arbitration agreement for the principal, the attorney-in-fact does not thereby agree to arbitrate whatever individual claims the attorney-in-fact might have. Avila v Southern Cal. Specialty Care, Inc., supra. See §§8.17, 15.28.
The line between impartial assistance to the court and biased advocacy of an interested person’s position may not be easy to draw in some cases, but the standard by which the court judges a personal representative’s participation under Prob C §11704(b) merely requires showing of good cause and does not require additional showing that participation is necessary to assist court. Estate of Kerkorian (2018) 19 CA5th 709. See §§15.3, 18.6.
The statute of limitations in CCP §366.2 limits the time to bring a cause of action, not the time to enforce a judgment. County Line Holdings, LLC v McClanahan (2018) 22 CA5th 1067. See §22.52.
The court in Estate of Reed (2017) 16 CA5th 1122 held that a statement of decision, which is not typically appealable, was properly appealed because it contained a section entitled “Orders” that included a statement that the court found “that it is in the best interest of the Estate to remove [the executor] from his position as executor of the Estate.” See §23.9.