Spring 2021 California Case Roundup

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Aghaian v. Minassian: Plaintiffs sufficiently alleged claims involving fraudulent transfer of assets by a guardian ad litem.  Status as guardian ad litem did not provide blanket immunity for actions taken as guardian, because fraudulent conduct is outside  of the scope of the guardian’s authority.  The transfer of property is the gravamen of a fraudulent transfer action, and sham judicial proceedings used to provide legal cover for the transfer offer no protection.

Estate of Michael Jackson.  The Estate of Michael Jackson prevailed over the IRS in a valuation dispute over California’s Right of Publicity.  The Tax Court held that the image and likeness of Jackson was worth $4,153,912, as compared to the IRS’s original position of $434,264,000.

2021 Homestead Exemption: As of January 1, 2021, the homestead exemption for California homeowners increased from $75,000, $100,000, or $175,000 to the greater of $300,000 or $600,000, depending on certain factors.  The dwelling itself determines the amount of the homestead exemption, not the composition of the people living inside the homestead property.

Bohnett v. County of Santa Barbara: The purchase of real property by a trust beneficiary from his siblings and co-beneficiaries did not constitute a parent-child transfer exempt from reassessment for property tax purposes.  Beneficial ownership of the trust property was transferred to the children when the settlor died and the trust became irrevocable.  When one trust beneficiary purchased the property from his siblings years later, this was not a parent-child transfer.  The transfer of beneficial ownership to the children was excluded from reassessment, but the transfer to one beneficiary years later was not.

Breslin v. Breslin:  Potential trust beneficiaries who received notice that the litigation over the trust was going to mediation, but did not participate in the mediation, were bound by the result.  An interested party in a California probate or trust litigation can forfeit their rights by choosing not to participate in trial and by ignoring notice from the court.

Keading v. Keading:  An award of double damages under California Probate Code section 859 is authorized for the commission of elder financial abuse, without a separate finding of bad faith.  Section 859 is not ambiguous in specifying when a bad faith finding is necessary for double damages.  The statutory language contains three different clauses describing the three different categories of conduct that can support double damages, each of which is separated by the conjunction “or.” The first two categories require a separate finding of bad faith but the third one—applying when a person “has taken, concealed, or disposed of the property . . . through the commission of elder or dependent adult financial abuse, as defined in Section 15610.30 of the Welfare and Institutions Code”—does not.

Eyford v. Nord:  A testator’s delusions for purposes of lacking testamentary capacity must be demonstrated to have existed at the time the trust or will was executed in order to invalidate the document.  A delusion “has been defined to be the conception of a disordered mind which imagines facts to exist of which there is no evidence and the belief in which is adhered to against all evidence and argument to the contrary, and which cannot be accounted for on any reasonable hypothesis.”  Delusions before or after the execution of the document, which were not demonstrated to have changed the disposition of the estate, will not invalidate the document.

Brokken v. Brokken:  No attorney fees can be awarded in a conservatorship proceeding where no conservator was appointed.  No statutory authorization exists to award attorney fees when there is no conservator.

Dunlap v. Mayer:  A deceased beneficiary’s estate has standing to request an accounting of the trust that the decedent was a beneficiary of during life.  The general rules of survivability apply to proceedings under the California Probate Code.  Therefore, the beneficiary’s right to request an accounting of the trust during her lifetime continued after her death.

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Complete Guide to California Probate

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