Opinion
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
Appeal from an order of the Superior Court of Fresno County. Debra J. Kazanjian, Judge. No. 07 CE PR 00380
No appearance for Plaintiff and Respondent.
McCormick, Barstow, Sheppard, Wayte & Carruth, Timothy L. Thompson and Mandy L. Jeffcoach for Defendant and Appellant.
OPINION
Gomes, Acting P.J.
Appellant Todd R. Tatro (Todd), a co-trustee of the Rodack Trust Indenture dated December 6, 1995, brings this appeal from a probate court order determining that a proposed petition brought by respondent Betty Jo Tatro (Betty Jo) does not violate a no contest clause. (Prob. Code, § 21320.) Todd claims the proposed petition to declare the trust revocable, approve modification of the trust, or terminate the trust and for an order to remove him as trustee violated the trust’s no contest provision. As a result, he argues the probate court erred in ruling that the petition was protected by the “safe harbor” provisions of section 21305, subdivision (b)(7). We affirm the finding the petition to modify the trust did not violate its no contest provisions.
All further statutory references are to the Probate Code.
Respondent did not file a brief. The statement of facts is taken substantially verbatim from appellant’s opening brief, respondent implicitly having agreed that appellant’s statement of facts is correct for purposes of this appeal by failing either to contradict it or to provide us with her own statement of facts. (See Osborn v. Mission Ready Mix (1990) 224 Cal.App.3d 104, 108.)
Madera County residents Romeo Gerald Tatro (Romeo) and Betty Jo Tatro were married for nearly 15 years. They had no children together but each had two sons from prior marriages. Betty Jo’s sons are Allen and Keith Paxton. Romeo’s sons are Todd and Lance Tatro (Lance). On December 6, 1995, Romeo and Betty Jo executed the Tatro Family Trust, the M.P. Irrevocable Trust, the Rodack Trust Indenture (Rodack Trust), the M.H.R. Trust Indenture (M.H.R. Trust), pour over wills, and related documents to establish an estate plan to control and ultimately distribute their real and personal property. The Tatro Family Trust was a revocable living trust; the M.P. Trust, M.H.R. Trust and Rodack Trusts were irrevocable. The Tatros transferred investments and personal property into the Rodack Trust and both real and personal property into the M.H.R. Trust.
For clarity, Betty Jo Tatro, Romeo Gerald Tatro, Todd R. Tatro, and Lance Tatro will be referred to by their first names. We intend no disrespect.
The M.H.R. and Rodack Trusts created certificates of interest “as a convenience and for purposes of distributions” of trust assets. Each trust’s certificates of interest were divided into 1,000 units. The trusts identified Romeo and Betty Jo as “THE INITIAL BENEFICIARIES, the Holders of the First Certificates or Units of Beneficial Interest.” The M.P. Irrevocable Trust was funded with certificates of interest in the M.H.R. and Rodack Trusts and with personal property. Betty Jo and Romeo transferred a 1,000-unit beneficial interest in the M.P. Irrevocable Trust to the Tatro Family Trust, a revocable living trust that created a marital exemption trust, a Q-TIP trust, and a surviving spouse trust upon the death of the first spouse. Pursuant to his last will and testament, Romeo gave the residue of his estate to the trustee of the Tatro Family Trust.
Romeo’s will nominated Betty Jo as executor, Todd as first alternate executor, Lance as second alternate executor, and Allen Paxton as third alternate executor. The M.H.R. and Rodack Trusts required at least two trustees, stating in Section 3.2: “THERE SHALL BE at least two Trustees. One Trustee must always be an Adverse Trustee. At least half (50%) of the Trustees shall be Unrelated Trustees. The Board of Trustees must maintain an Independent Trustee status.” Romeo and Betty Jo appointed Omni Estate Services, Inc. as the unrelated trustee of the M.H.R. and Rodack Trusts. Omni, in turn, appointed Todd as adverse trustee of the two trusts.
The M.H.R. and Rodack Trusts also created the position of Trust Protector, a nonmember of the board of trustees who “acting independently, shall only have the power to remove a Trustee for good cause.” On the date they signed the trusts, Romeo and Betty Jo signed agreements appointing Lance as Trust Protector. Each trust included a no contest clause, stating:
“SECTION 19:3: IF ANY CERTIFICATE Holder of this Trust shall contest in any court the validity of this Trust or in any manner take action to nullify or set aside this Trust or any of its provisions, then that Certificate Holder shall be paid $10.00 cash, the interest of that Certificate Holder shall cease and that person’s interest shall be divided up among the other Certificate Holders on a pro-rata basis. The Trustees are authorized to defend, at the expense of the Trust, any kind of contest or attack by a Certificate Holder or any other person against the Trust or against any of its provisions.”
Romeo’s will also included a no contest clause, which stated:
“Section 9.1. No Contest Clause: If any beneficiary or remainderman under this Will in any manner, directly or indirectly, by legal proceedings or otherwise, challenges, contests or attacks this Will or any of its provisions, or impairs or invalidates any of the provisions I have made in it, then any gift, share, interest, or other provision I have made to that person under this Will, in my estate, or in the estate of any trust established by this Will is revoked and shall be disposed of as if that contesting beneficiary or remainderman had predeceased me without issue.”
Romeo died on January 27, 2005. On April 9, 2007, Lance removed Betty Jo’s son, Allen Paxton, as a trustee of the M.H.R. Trust. On April 13, 2007, Betty Jo filed petitions for determination that certain proposed petitions would not violate the no contest clauses in the respective will and trust instruments. On May 11, 2007, Lance removed Allen Paxton as a trustee of the Rodack Trust and Todd appointed Douglas Richesin in Paxton’s place and stead. On May 12 and June 12, 2007, Betty Jo filed applications for determination that her proposed petition would not violate the no-contest clauses in the respective will and trust instruments.
As to both the Rodack Trust and the M.H.R. Trust, Betty Jo sought (1) a determination that the trusts were revocable; (2) an order directing the trustee to treat the trusts as revocable; (3) modification of the trusts to negate their irrevocable nature and permit Betty Jo to withdraw her original one-half community property interest; (4) termination of the trusts; (5) removal of Todd as trustee; (6) removal of Lance as Trust Protector; and (7) appointment of herself as successor Trust Protector.
Todd opposed Betty Jo’s efforts as “an attempt to transform an irrevocable will and trust into revocable instruments.” He further maintained her proffered petitions would violate the no contest provisions of the trusts. On August 3, 2007, the superior court heard oral argument on Betty Jo’s petitions and applications. In separate orders on petitions (one for the Rodack Trust and one for the M.H.R. Trust), the trial court ruled in pertinent part:
(1) The public policy exceptions in section 21305, subdivision (b) generally applied to the trusts because Romeo died after the effective date of section 21305;
(2) The public policy exception of section 21305, subdivision (b)(1) was inapplicable because the primary purpose of the trusts was to serve as an estate plan;
(3) Betty Jo could not take advantage of section 21305, subdivision (b)(11) because her challenge constituted a direct contest of the instruments;
(4) The proposed petition to remove Todd as trustee came within the public policy exception for removal of a fiduciary (§ 21305, subd. (b)(7)) and did not constitute a contest;
(5) The proposed petition to remove Lance as Trust Protector and appoint Betty Jo as his successor came within the public policy exception for removal of a fiduciary (§ 21305, subd. (b)(7)) and did not constitute a contest.
DISCUSSION
Todd contends the trial court committed reversible error in rendering its orders on the respective petitions by construing section 21305, subdivision (b)(7) to apply to the Rodack and M.H.R. Trusts.
Section 21305 states in relevant part:
“(b) Except as provided in subdivision (d), notwithstanding anything to the contrary in any instrument, the following proceedings do not violate a no contest clause as a matter of public policy: [¶] ... [¶]
“(7) A pleading regarding the appointment of a fiduciary or the removal of a fiduciary. [¶] ... [¶]
“(d) Subdivision (b) shall apply only to instruments of decedents dying on or after January 1, 2001, and to documents that become irrevocable on or after January 1, 2001. ... [¶] ... [¶]
“(f) The term ‘pleading’ in subdivision (b) includes a petition, complaint, response, objection, or other document filed with the court that expresses the position of a party to the proceedings.”
The trial court’s October 15, 2007 orders stated in pertinent part:
“Romeo Tatro died January 27, 2005. However, the Rodack Trust [and M.H.R. Trusts were each] irrevocable as of the date of its execution. ... Todd and Lance Tatro argue that because the trust became irrevocable in 1995, prior to the effective date of the statute, subdivision (b) of section 21305 does not apply.
“Although subdivision (d) of section 21305 uses the word ‘and’, it is disjunctive, not conjunctive. ... [¶]
“The language of the statute is clear. The statute reads in the alternative. Subdivision (d) provides that subdivision (b)’s exceptions will apply in two instances: first, when a decedent dies after January 1, 2001 and second, when an instrument becomes irrevocable after that date. This is demonstrated by the fact that the phrases are divided by a comma, and refer separately to ‘instruments’ of decedents dying after the effective date and to ‘documents’ that become irrevocable after the effective date, i.e., there are two classes of documents to which the statute refers. This evinces a legislative intent to address two separate situations.
“The case of Hermanson v. Hermanson [(2003)] 108 Cal.App.4th 441 has no relevancy on this question. In Hermanson, the trust became irrevocable on the death of the testator, and both events happened before the effective date of the statute. (Hermanson v. Hermanson, supra, 108 Cal.App.4th at p. 443.) … Hermanson did not address the situation where the trust became irrevocable before the effective date of the statute and the death of the trustor occurred after. ‘A case is not authority for propositions neither considered nor discussed in the opinion.’ (In re Muszalski (1975) 52 Cal.App.3d 500, 504.) [¶] ... [¶]
“In short, Hermanson does not judicially exempt documents which became irrevocable prior to the effective date of the statute where the testator or trustor died after the effective date of the statute. Nor does it express a legislative preference for such an outcome.
“Romeo Tatro died after the effective date of section 21305. The public policy exceptions in subdivision (b) apply to this case.”
Todd now contends the public policy exceptions of section 21305, subdivision (b) should apply only if both (a) the decedent died on or after January 1, 2001 and (b) the instrument was irrevocable on or after January 1, 2001. Todd acknowledges that Romeo died on January 27, 2005 (after the statutory date) but points out the trusts became irrevocable in 1995, some six years prior to the enactment of the public policy exceptions of section 21305, subdivision (b). Since the instant situation does not satisfy both elements of subdivision (d), he maintains the no contest exception for a “pleading regarding the appointment of a fiduciary or the removal of a fiduciary” cannot be invoked in this case. (§ 21305, subd. (b)(7).)
He specifically argues:
“In interpreting Probate Code § 21305 the trial court, without any discussion, found that since subdivision (d) referred to both instruments and documents, and the two phrases are separated by a comma, the legislature’s intent was clear; namely that ‘and’ was disjunctive so the public policy exceptions applied to two separate classes of documents. However, this conclusion ignores one of the basic [tenets] of statutory interpretation, which is that the ordinary usage of words must be applied. According, absent some secondary extrinsic evidence that the term ‘and’ was to apply disjunctively, its ordinary meaning and usage should have been applied. [(Kobzoff v. Los Angeles County Harbor/UCLA Medical Center (1998) 19 Cal.4th 851, 861.)] [¶] … [¶]
“Likewise, by deviating from the ordinary interpretation and usage of ‘and’, the trial court should have engaged in an analysis of the legislative history to ascertain if the [L]egislature intended ‘and’ to be disjunctive. Such an analysis would have conformed to the general tenets of statutory construction that mandate that if the ordinary meaning of words are going to be ignored, then extrinsic secondary evidence must support the deviation. (Kobzoff, supra, 19 Cal.4th at p. 861.) Had the trial court engaged in such an analysis, it would have discovered ... that the intent of the [L]egislature was to limit, not expand, the public policy exceptions codified in subdivision (b). Of course, its intent to limit those exceptions is expressly evidenced by the use of the conjunctive ‘and’ and not the disjunctive ‘or’.”
The interpretation of statutes presents questions of law subject to independent review on appeal. Our primary aim in construing any law is to determine the legislative intent. In doing so we first look to the words of the statute, giving them their usual and ordinary meaning. (In re Clarissa H. (2003) 105 Cal.App.4th 120, 125.) The word “and” ordinarily is conjunctive. (Hoechst Celanese Corp. v. Franchise Tax Bd. (2001) 25 Cal.4th 508, 528.) The ordinary usage of “and” is to condition one of two conjoined requirements by the other, thereby causally linking them. Use of the conjunction “and” indicates one must act after both events occur. Use of the disjunctive “or” indicates that either event allows an action. (Kobzoff v. Los Angeles County Harbor/UCLA Medical Center, supra, 19 Cal.4th at p. 861.)
In Estate of Hoffman (2002) 97 Cal.App.4th 1436 (Hoffman), Division Three of the Court of Appeal, Second District, held the version of section 21302, subdivision (b) enacted in 2000 “applies across the board and extends to instruments executed before the effective date of the statute. The rationale for the broad application of subdivision (b) appears on the face of the statute, which provides the proceedings enumerated in subdivision (b) ‘shall not violate a no contest clause as a matter of public policy.’ (§ 21305, subd. (b), italics added.) Having concluded the proceedings specified in subdivision (b) shall not be deemed a contest as a matter of public policy, the Legislature determined the safeguard of subdivision (b) should not be restricted to instruments executed after the statute’s effective date, and instead should apply regardless of the date an instrument was executed.” (Hoffman, supra, 97 Cal.App.4th at pp. 1445-1446.)
The most recent version of section 21305, subdivision (b) originated in Senate Bill 1478. The analysis of that bill stated in pertinent part:
“On April 30, 2002, the Second District [Court] of Appeal, in applying the new rules regarding no contest clauses, held that Section 21305 (b), which lists those proceedings deemed to be not in violation of a no contest clause as a mat[t]er of public policy, applies to all testamentary and trust instruments, whether signed prior to or after the effective date of AB 1491 (January 1, 2001). [Estate of Hoffman, B146383, Second Appellate District, April 30, 2002.]
“Proponents are concerned that proceedings added to Section 21305 by this bill apply only to instruments that are made irrevocable on or after January 1, 2003. Thus, the bill specifically contains language to that effect (proposed Section 21305(d), page 3, lines 38 and 39, page 4, lines 1 and 2).
“In light of the court’s decision in Estate of Hoffman, the bill should probably be amended to expressly state that the new Section 21305 shall apply only to instruments that become irrevocable on or after January 1, 2003 and instruments executed by a person who dies on or after January 1, 2003. This amendment would acknowledge the holding in Estate of Hoffman and avoid any confusion as to which portion of Section 21305(b) would be retroactive or prospective.” (Analysis of Sen. Bill No. 1878 (2001-2002 Reg. Sess.) May 7, 2002, p. 4.)
A subsequent bill analysis stated in pertinent part:
“The author proposes amendments to SB 1878 to clarify that the bill is to be applied prospectively. On April 30, 2002, the Second District Court of Appeal in applying the new rules created by AB 1491 for no contest clauses, held that Section 21305(b), listing actions deemed not to be in violation of a no contest clause as a matter of public policy, applied to all instruments whether signed before or after the effective date of AB 1491 (January 1, 2001). (Estate of Hoffman (2002) 97 Cal.App.4th 1436.) The proposed amendments to SB 1878 expressly state that the changes made by AB 1491 to section 21305(a) and (b) are to apply prospectively only, to instruments of decedents dying on or after January 1, 2001, and to documents that become irrevocable as of that date. The bill also contains express language stating that the changes made by SB 1878 apply only to instruments of decedents dying on or after January 1, 2003 (the effective date of this bill, should it be enacted), and to documents that become irrevocable as of that date.” (Analysis of Sen. Bill No. 1878 (2001-2002 Reg. Sess.) Jun. 11, 2002, p. 7.)
The foregoing legislative history supports the trial court’s construction. Section 21305, subdivision (d) employs the term “instruments.” The Probate Code defines “instrument” to mean “a will, trust, deed, or other writing that designates a beneficiary or makes a donative transfer of property.” (§ 45.) Section 21305, subdivision (d) specifically refers to “instruments of decedents dying on or after January 1, 2001.” The subdivision divides the pertinent phrases by a comma and refers separately to “instruments” of decedents dying after the effective date and to “documents” that become irrevocable after the effective date. The contemporaneous legislative bill analyses acknowledged the holding of the Hoffman case, which observed: “the safeguard of subdivision (b) should not be restricted to instruments executed after the statute’s effective date, and instead should apply regardless of the date an instrument was executed.” (Hoffman, supra, 97 Cal.App.4th at pp. 1445-1446.)
By enacting the bill, the Legislature clarified the Hoffman rule by adding certain proceedings to the provisions of section 21305. The Legislature made those provisions applicable only to instruments of decedents dying on or after January 1, 2003 and to documents that became irrevocable on or after January 1, 2003. (§ 21305, subd. (d)(9), (11), and (12).) With respect to the provision at issue here (21305, subd. (b)(7)), the Legislature made the provision applicable only to “instruments of decedents dying on or after January 1, 2001, and to documents that become irrevocable on or after January 1, 2001.” (§ 21305, subd. (d).) The word “and” may be interpreted as “or” to carry out the Legislature’s intent in drafting a statute. (Bianco v. Ind. Acc. Com. (1944) 24 Cal.2d 584, 587.) Here, the most logical construction of the term “and” is to find that it refers to instruments of decedents dying on or after January 1, 2001 as well as to documents that became irrevocable on or after January 1, 2001.
DISPOSITION
The trial court’s order is affirmed. Respondent is awarded her costs on appeal.
WE CONCUR:
Dawson, J, Hill, J.