Opinion
B295773
03-23-2020
DANA URICK, as Trustee, etc., et al., Plaintiffs and Appellants, v. MARK BOYKIN, Defendant and Respondent.
Klapach & Klapach, Joseph S. Klapach, for Plaintiffs and Appellants. Mark Boykin, in pro. per., for Defendant and Respondent.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Los Angeles County Super. Ct. No. BC696459) APPEAL from a judgment of the Superior Court of Los Angeles County, David Sotelo, Judge. Reversed, with directions. Klapach & Klapach, Joseph S. Klapach, for Plaintiffs and Appellants. Mark Boykin, in pro. per., for Defendant and Respondent.
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Plaintiff and appellant Dana Urick, as trustee of the Allyne L. Urick Trust Agreement, as a beneficiary of the trust, and as guardian ad litem for her beneficiary son Trentyn Urick-Stasa, appeals from a judgment of dismissal following an order granting judgment on the pleadings in favor of defendant and respondent attorney Mark Boykin, in these consolidated legal malpractice actions based on trust provisions that he drafted. The trial court found that the actions were barred by the one year statute of limitations for legal malpractice, and Dana had not shown there was a reasonable possibility she could amend the complaints to state a cause of action. On appeal, Dana contends: (1) Boykin owed a duty of care to the trustee and to the named beneficiaries of the trust; (2) the complaints are not barred on their face by the statute of limitations; (3) the trial court erred by taking judicial notice of the filing date of Dana's prior petition to reform the trust without also taking judicial notice of a tolling agreement with Boykin; and (4) even if the complaints are defective on their face, the trial court should have allowed leave to amend to allege the date of discovery and the tolling agreement. We conclude that Boykin did not owe a duty of care to the trustee or the beneficiaries for alleged errors in drafting the distribution that Allyne intended among the beneficiaries of the trust, but he owed them a duty of care for drafting errors that negligently reduced trust assets or failed to perfect the gifts expressly set forth in the trust. The date of Dana's reformation petition, which is subject to judicial notice, established that the complaints were barred by the statute of limitations, but Dana has shown that she can amend the complaints to allege tolling agreements that bring the claims within the statute of limitations. Therefore, we reverse with directions.
Because several participants in the underlying events share the last name Urick, they will be referred to by their first names for ease of reference.
FACTS AND PROCEDURAL BACKGROUND
Dana's Prior Petition to Reform the Trust
In Urick v. Urick (2017) 15 Cal.App.5th 1182 (Urick), this appellate court considered an appeal filed by Dana's brother Willis E. Urick III, from an order granting an anti-SLAPP motion filed by Dana, in her capacity as trustee, in a trust proceeding. We concluded that if the evidence submitted in the anti-SLAPP proceeding were viewed in the light most favorable to Willis, he had made the prima facie showing necessary to sustain a judgment in his favor. (Id. at pp. 1196-1199.) Dana submitted conflicting evidence that revealed triable issues of fact, but did not defeat Willis's claims as a matter of law, and therefore, the anti-SLAPP motion should have been denied. The following facts are taken from the evidence summarized in Urick to explain the procedural background. (Id. at pp. 1186-1191.)
SLAPP is an acronym for "Strategic Lawsuits Against Public Participation." (Equilon Enterprises v. Consumer Cause, Inc. (2002) 29 Cal.4th 53, 57, fn. 1.)
A. Allyne Urick's Estate Plan
Boykin prepared Allyne Urick's estate plan, which provided for her children (Dana and Willis) and one of her grandchildren (Urick-Stasa). Boykin summarized his initial discussions with Allyne in a letter dated December 14, 2012. Allyne originally wanted Urick-Stasa to receive a substantial sum in trust, and Willis and Dana to receive a fixed percentage of her estate in the form of an annuity for the rest of their lives, with the remainder passing to Phillips Academy. Boykin suggested a charitable remainder annuity trust (CRAT), which pays a fixed amount of the original value of the trust assets to the beneficiaries each year. At the end of the trust term, the remainder of the trust estate passes to charity. Allyne indicated that she wanted to reduce the potential estate taxes, but was more concerned about providing for her grandson and not having her children receive a large sum of money at her death.
In a letter dated January 7, 2013, Boykin provided Allyne with a draft of the trust which reflected their discussions that Allyne wanted Dana and Willis to receive an annuity of 5 percent of her net estate for their lifetimes, with the remainder to Urick-Stasa. Allyne responded that she wanted Urick-Stasa to receive an annuity share equal to her children. Boykin explained that he could draft it that way, but noted that giving Urick-Stasa an annuity in addition to the remainder could lead to substantial additional taxes.
In a letter dated February 6, 2013, Boykin enclosed a new draft of the trust for Allyne to review. He explained that he had returned to a charitable remainder trust based on their telephone conversation in which she stated that she wanted Phillips Academy to receive the remainder, even though the gift would probably not qualify for charitable treatment.
The trust named Dana as the successor trustee. If Dana should cease to serve, Willis would serve as trustee. At Allyne's death, after certain payments and distributions from the trust estate, the remaining trust principal would be annuitized. Five percent of the fair market value of the assets on the date of death would be divided into three equal shares and distributed to Willis, Dana, and Urick-Stasa each year. Payment of the annuity would cease upon the earlier of Urick-Stasa attaining age 35 or the death of the last surviving named recipient of a share of the annuity. Upon termination of the annuity, the remaining principal would be distributed to Phillips Academy Andover in memory of Willis E. Urick, Jr., class of 1934.
On March 8, 2013, Allyne Urick executed the trust agreement and a pour-over will. Boykin videotaped Allyne's execution of her estate plan. Allyne stated that she did not want to leave her estate outright to her two children. Boykin explained that Dana, Willis, and Urick-Stasa would receive 5 percent of the trust for the rest of their lives, or until Urick-Stasa reached age 35. Allyne corrected him and said it would be 5 percent for each child. They went off the record. On the record, Boykin stated, "Mrs. Urick, you and I had a discussion off the record about your desires for the distribution of your estate." Allyne answered, "That's correct." Boykin continued, "And it's not five percent to each of your three children." Allyne said, "I understand that now." Boykin responded, "And you understand that it's five percent of the entire value of the trust every year." Allyne answered, "Correct." Boykin added, "Split three ways." Allyne said, "Right. Got it." Boykin asked, "And that's what you want to do?" Allyne said, "Yes, I do." Boykin said, "Okay." Allyne added, "That is quite a bit of money from where I am sitting." Boykin continued, "All right. And then that is going to continue until both of your children have passed away and [Urick-Stasa] attains age 35 years; correct?" Allyne said, "Correct."
Boykin asked, "Then what do you want to have happen to the trust fund? [¶] Where would it be distributed at the point [Urick-Stasa] reached 35?" They had a discussion off the record about the length of time that the annuity would be paid to Urick-Stasa. Allyne thought she might want to extend it. She wanted to confer and ask for Boykin's advice. Boykin explained that the remainder going to Phillips Academy would not be zero, and would probably be somewhere between $3 and $10 million. Allyne responded, "Oh, that's a lot of dough right there." She decided that they would have to give some consideration to the distribution, but at present she would leave it as it was written. Before Allyne signed the documents, Boykin asked if she had an opportunity to review them that morning and previously. She said that she did. Boykin asked, "And we had discussion about [Urick-Stasa's] distribution at age 35?" Allyne said they had. Boykin asked, "And you are now okay with that; correct?" Allyne answered, "Yes. At the present time. Yes."
Allyne signed the documents. The trust was funded with her residence, an apartment building, and several investment accounts. She had some bank accounts payable on death through beneficiary designations which were not placed in the trust.
On January 3, 2014, Allyne addressed a handwritten note "[t]o whom it may concern." The note stated, "I hereby delete my son Willis E. Urick III from the assets of my Family Trust, established March 8, 2013. [¶] I have shared my reasons in a document which is in a sealed envelope, to be opened and read in the event of a contest."
After receiving Allyne's handwritten note expressing her intent to disinherit Willis, Boykin prepared an amendment to the trust that made Dana the sole trustee and distributed annuity amounts to Dana and Urick-Stasa only. The amendment was never signed. He prepared a similar amendment in February 2014, which was also never signed.
On August 6, 2014, Allyne instead executed an "Amendment and Full Restatement of the Allyne L. Urick Trust Agreement dated March 8, 2013." The provisions of the restated trust controlled over all earlier statements of the trust. Dana was appointed as the successor trustee. If she ceased to serve, Wells Fargo Bank was named as successor trustee. The restated trust continued to be structured as a charitable remainder annuity trust. After certain payments and distributions from the trust estate, the remaining principal was to be annuitized. Five percent of the fair market value of the assets would be distributed each year in equal shares to Willis, Dana, and Urick-Stasa. Payment of the annuity amount was to cease "upon the earliest of [Urick-Stasa] attaining the age of thirty-five (35) years, upon the death of the last surviving named recipient of a share of the annuity amount or upon the latest date allowed by Internal Revenue Code §[ ]664." Distributions to Urick-Stasa were to be held in trust and distributed on a schedule. When the annuity payments ceased, the remainder of the trust estate was to be distributed to Phillips Academy in memory of Willis E. Urick, Jr., class of 1934. The trust contained a no contest clause.
B. Reformation Petition and Subsequent Proceedings
Allyne passed away on August 18, 2015, and Dana assumed the role of trustee. On February 16, 2016, Dana filed a petition to reform the trust under Probate Code sections 17000 and 17200, on the grounds that the terms were misrepresented by the drafter, Allyne had mistakenly signed the trust believing it reflected her intent, and the trust did not contain the distribution plan that she requested. Dana proposed to reform the trust to correctly state the trustor's intent, after distributing specific bequests and personal property, to divide the remaining principal into two shares, with one share for Dana and one for Urick-Stasa. The assets would be held in trust for 10 years, then distributed outright to Dana and Urick-Stasa. If no beneficiaries survived, the assets would be distributed in equal shares to four institutions, one of which was Phillips Academy. The caption at the top of the petition and the signature block on the final page stated that the attorneys represented Dana, but did not mention her role as trustee. Dana signed a verification of the petition which did not state that she was signing it as trustee.
Willis and Phillips Academy each objected to the reformation petition, and on May 31, 2016, Willis filed a petition for instructions as to whether Dana's petition violated the no contest clause of the trust. He argued that the reformation petition was a direct contest to invalidate the distributive provisions of the trust on the basis of fraud, undue influence, and duress, in violation of Probate Code section 21310, subdivision (b)(4).
On August 4, 2016, in her capacity as trustee, Dana filed an anti-SLAPP motion with respect to the no contest petition. She argued that a petition to reform the trust was protected litigation activity under the anti-SLAPP statute, and Willis could not show a probability of prevailing on the merits, because: (1) she filed the reformation petition in her capacity as trustee; (2) it was not a direct contest, because she sought to reform the trust on the ground of mistake; and (3) she had probable cause for filing the petition.
On September 28, 2016, the trial court granted the anti-SLAPP motion, finding Dana's petition to reform the trust was protected litigation activity. The court further found that Willis failed to show a probability of prevailing because the petition was brought in Dana's capacity as trustee. It was not a direct contest because she brought it on the grounds of mistake and misrepresentation, not duress, fraud, or undue influence.
Willis filed an appeal from the order granting the motion to strike, and this appellate court reversed the order in a published opinion on October 5, 2017. (Urick, supra, 15 Cal.App.5th at p. 1199.) Allegations of Legal Malpractice Action
On February 28, 2018, Dana, in her capacity as trustee, filed an action for professional negligence against Boykin. In addition to many of the facts above, the complaint alleged that Allyne retained attorney William Eick in 2012 to prepare an estate plan for her. She had not previously had a trust, but she did not want the joint venture partner in the apartment building to gain knowledge of the other assets in her estate through a public probate. Eick's letters and drafts for a trust showed Allyne consistently wanted to leave the majority of her estate to Dana and a significant portion of her estate to Urick-Stasa. Allyne wanted to provide for Urick-Stasa's needs and maintenance, including for private school education, college, and graduate school. Allyne did not intend to provide equally for Willis, eventually deciding not to provide any portion of her estate to him. The plan took longer to finalize than Allyne hoped, and she did not sign any of the documents that Eick prepared.
Allyne met with Boykin in late 2012. Boykin suggested the use of a CRAT. The suggestion made no sense in light of Allyne's stated objectives. Boykin failed to give competent or complete advice by stating, among other things, that he could not even approximate the tax treatment because of the uncertainty over the estate tax and generation skipping tax law at the time. Boykin did not retain a competent financial analyst for computations to support whether the proposed trust would qualify under the Internal Revenue Code (IRC) as a CRAT for tax treatment.
The provisions of the original trust provided for annuity payments that ceased upon the earliest of the death of the last named recipient of a share or Urick-Stasa reaching age 35. Urick-Stasa's payments were to be held in trust, and there was no provision authorizing the trustee to pay for his private school education or any other maintenance needs. The trust provisions did not qualify as a CRAT and failed to qualify for any charitable deduction under the IRC, while simultaneously resulting in a significant generation skipping tax.
Administration of the trust is unworkable, because it requires the trustee to appraise the real property each year, distribute a small percentage of the real property to each beneficiary each year for 20 years, file trust returns each year without any charitable benefit, and Urick-Stasa's portion will be significantly reduced by the unnecessary accumulation of taxes on his annual payments, which would be re-taxed annually for decades.
The videotaped execution of the estate plan showed Allyne had not reviewed or approved the document that she signed, and she did not have sufficient time to review and understand the document. Allyne expressed concern about the age Urick-Stasa was to receive the full distribution of his share and about other charities she would like to include. She was not happy about the amount of the potential remainder to Phillips Academy, and in light of her husband's gift of only $25,000 to Phillips Academy on his death, it was extremely unlikely that Allyne would have agreed to leave $3 to $10 million to her husband's former school.
The restated trust included new provisions for the appointment of successor trustees and annuity payments that would cease on the earliest of Urick-Stasa reaching age 35, the death of the last named recipient of a share, or the latest date allowed under IRC section 664. The restated trust continued to require the annuity payments to Urick-Stasa be held in trust and distributed on a set schedule beginning at age 25. There is no provision authorizing the trustee to use funds to pay for his schooling, needs, and maintenance. The arrangement consumes the majority of Urick-Stasa's inheritance in accumulated taxes over the holding period and a significant generation skipping tax.
Although Boykin appeared to document changes as a practice, and the original preparation and execution of the plan were well documented, Boykin's file does not contain any correspondence between February 21, 2014, and August 7, 2014, regarding the changes made in the restated trust. Boykin did not document any instructions to remove Willis or add him back to the trust. Boykin did not document why he presented Allyne with the restated trust, and he did not provide any cover letter to Allyne setting forth the changes made to her trust in the restatement. Boykin did not videotape the execution of the restatement and there is no document explaining the terms to Allyne prior to its execution. The restated trust does not reflect the removal of Willis as a beneficiary that Allyne had requested, the file does not document Allyne's desire to reinstate him as a beneficiary after the handwritten amendment removing him, and the file does not document that Allyne understood Boykin had put Willis back in the restated trust as a full beneficiary.
Among other consequences of the CRAT that Boykin did not document having advised Allyne, he failed to advise Allyne that the remainder of the trust estate would not pass after the death of her children and grandson, as was represented in the videotape, but while they were still living. He failed to document and advise Allyne that under the terms, Urick-Stasa would not receive even the minimum number of years of annuity payments to age 35 that Boykin had represented Urick-Stasa would receive. Allyne relied on Boykin's knowledge and expertise in handling her estate plan and relied on him to accurately reflect her intent. Boykin failed to draft the trust or the restated trust in accordance with Allyne's intent, and misrepresented the terms of the trust, leading Allyne to believe it reflected her intent. Boykin's failure to exercise reasonable skill and care in representing Allyne resulted in loss to the trust corpus in the form of significant attorney fees and unnecessary tax liability.
That same day, Dana filed a substantially similar action on behalf of herself and as guardian ad litem for her Urick-Stasa against Boykin for professional negligence. The trial court ordered the cases consolidated. Motion for Judgment on the Pleadings
In August 2018, Boykin filed a motion for judgment on the pleadings. He noted that there was ongoing litigation between the trust and Lucian Seifert regarding joint ownership of a large apartment building and seeking to dissolve the partnership. After he prepared Allyne's trust, Boykin began representing Seifert without knowing Seifert was the other partner in the apartment ownership. Dana's attempted disqualification of Boykin had been denied.
Boykin argued that Dana knew about her potential legal malpractice claims, as shown by the allegations of the reformation petition, but did not file legal malpractice actions until after the one-year statute of limitations had expired. He asserted that a claim for malpractice in the preparation of an estate plan must be brought within one year of the testator/trustor's death, when the rights of the beneficiary have vested and the successor trustee has a duty to investigate the terms of the trust. Allyne died on August 18, 2015, and Dana had reason to immediately review the operative document, so the actions filed two and a half years later, on February 28, 2018, were barred. Boykin noted that the parties entered into an "ineffective" tolling agreement on August 30, 2016, after the statutory period had run, and since the tolling agreement was not alleged in the complaints, they did not state a claim on their face. Boykin also argued that the actions were barred by collateral estoppel, because Dana's allegations about drafting errors were rejected in Urick.
Dana filed an opposition as trustee of the Trust. She argued that the statute of limitations did not begin to run on the date of Allyne's death. Code of Civil Procedure section 340.6 provides that the statute of limitations on a claim for legal malpractice runs one year after the plaintiff discovers or through reasonable diligence should have discovered the facts constituting the wrongful act or omission. Dana would not have discovered the wrongful act or omission on the date of Allyne's death. She did not see the trust until after Boykin provided it to her accountant on August 25, 2015, and she had no reason to know of any drafting defects at that time. Boykin continued to send related documents to Dana through September 28, 2015. Dana retained an attorney on September 8, 2015, to review documents that she received from Boykin. She did not know or have reason to know the facts constituting malpractice until mid-October 2015 at the earliest. Dana and Boykin entered into a tolling agreement on August 30, 2016, within a year of her initial discovery of facts underlying the claims. Therefore, the claims were not barred by the statute of limitations. In the event the motion were granted, Dana requested leave to amend the complaint.
Dana submitted the declaration of her attorney representing that the complaint could be amended to allege the following additional facts. Allyne died on August 15, 2015. Dana did not see a copy of the trust until after Boykin provided it to her accountant on August 25, 2015, and she had no reason to believe or know of any drafting defects in the trust. On August 31, 2015, Boykin emailed Dana copies of his correspondence with Allyne. On September 8, 2015, Dana retained Kira Mastellar to review the documents that she had found and received from Boykin. Mastellar did not complete a review of the documents for several weeks. Boykin continued to send documents related to the estate plan through at least the end of September 2015. On September 28, 2015, Boykin sent a copy of the transcript for the execution of the estate plan. Allyne's handwritten amendment to the trust was not discovered until at least a month after Mastellar was retained to review the documents. Dana was not aware of the facts that are the basis for the legal malpractice claim until mid-October 2015 at the earliest. The parties executed a tolling agreement effective on August 30, 2016, less than a year after Dana became aware of the factual basis for legal malpractice.
Dana attached the tolling agreement, which was to have expired on August 30, 2017. She also submitted an extension agreement in which the parties agreed to extend the tolling agreement for an additional six months, up to and including February 28, 2018.
Boykin filed a reply. He noted that Allyne died on August 18, 2015, and argued the claim was barred on the face of the complaint. The tolling agreement was not alleged and was obtained too late. He claimed the complaint alleged Dana expected to receive Allyne's entire estate, either alone or in shares with her son. She had a duty to inquire into the terms of the trust at the time of her mother's death. Even a cursory glance would have shown that she was not inheriting the entire estate.
A hearing was held on August 27, 2018. No reporter's transcript or settled statement for the hearing is provided in the record on appeal. The minute order reflects that the trial court quoted extensively from the facts in Urick for background. The trial court noted that Dana's petition to reform the trust was filed on February 16, 2016. "Thus, setting aside defendant's (unsupported) claim that the statute of limitations necessarily began to run on the date of Allyne's death, by February 2016, when Dana filed a petition stating that the trust did not contain the distribution plan Allyne requested defendant to draft, Dana had 'discover[ed], or through the use of reasonable diligence should have discovered, the fact constituting the wrongful act or omission.' Assuming the statute began running on the date Dana filed her petition, the complaint would have been time-barred if filed after February 16, 2017, a little over a year prior to when the complaint was actually filed."
The court continued, "In opposition, plaintiff asserts that the parties entered into a tolling agreement, effective August 30, 2016, whereby any cause of action between the parties would be tolled for at least a year. [Citation to declaration.] The existence and effect of the tolling agreement is not pled, however, and plaintiff does not request judicial notice of the tolling agreement. The Court therefore does not consider the tolling agreement." The court concluded, "Although plaintiff requests leave to amend, there does not appear to be a reasonable possibility of stating this cause of action." The court granted the motion without leave to amend.
On December 14, 2018, the trial court entered its order granting the motion for judgment on the pleadings, as well as a judgment of dismissal of the complaints. Dana filed a timely notice of appeal from the judgment and intermediate rulings on behalf of herself and her son, as beneficiaries, and as trustee of the trust.
DISCUSSION
Standard of Review
A motion for judgment on the pleadings may be made on the ground that the complaint fails to state facts sufficient to constitute a legally cognizable claim. (Code Civ. Proc., § 438, subd. (c)(1)(B)(ii); Sofias v. Bank of America (1985) 172 Cal.App.3d 583, 586.) In reviewing the grant of such a motion, an appellate court applies the same rules that govern review of the sustaining of a general demurrer. (Smiley v. Citibank (1995) 11 Cal.4th 138, 146.) "Thus, 'we are not bound by the determination of the trial court, but are required to render our independent judgment on whether a cause of action has been stated.' (Hoffman v. State Farm Fire & Casualty Co. (1993) 16 Cal.App.4th 184, 189.)" (Mendoza v. Continental Sales Co. (2006) 140 Cal.App.4th 1395, 1401 (Mendoza).)
"In a case involving a motion for judgment on the pleadings, our Supreme Court has said: '[W]e treat the properly pleaded allegations of [the] complaint as true, and also consider those matters subject to judicial notice. [Citations.] "Moreover, the allegations must be liberally construed with a view to attaining substantial justice among the parties." [Citation.] "Our primary task is to determine whether the facts alleged provide the basis for a cause of action against defendants under any theory." [Citation.]' (Alliance Mortgage Co. v. Rothwell (1995) 10 Cal.4th 1226, 1232.)" (Mendoza, supra, 140 Cal.App.4th at p. 1401.) "When liberally construing allegations, a reviewing court also assumes the truth of all facts that may be inferred reasonably from (1) the facts pled, (2) the facts contained in exhibits to the complaint, and (3) the facts that are judicially noticed." (Id. at p. 1402.)
"Further, to prevail on a demurrer based on the statute of limitations, a defendant must establish the entire cause of action is untimely. A demurrer challenges a cause of action and cannot be used to attack a portion of a cause of action. (Caliber Bodyworks, Inc. v. Superior Court (2005) 134 Cal.App.4th 365, 384-385.) Thus, where a plaintiff sues a defendant for legal malpractice alleging several distinct acts of malpractice with respect to a single representation, a demurrer is properly granted on the basis of the statute of limitations only if each alleged act of malpractice is time-barred. (PH II, Inc. v. Superior Court (1995) 33 Cal.App.4th 1680, 1682 [reversing demurrer sustained to legal malpractice cause of action because plaintiff timely alleged at least one negligent act].)" (Pointe San Diego Residential Community, L.P. v. Procopio, Cory, Hargreaves & Savitch, LLP (2011) 195 Cal.App.4th 265, 274.)
"Whether a motion for judgment on the pleadings should be granted with or without leave to amend depends on 'whether there is a reasonable possibility that the defect can be cured by amendment . . . .' (Blank v. Kirwan (1985) 39 Cal.3d 311, 318 [stating rule applied to a general demurrer].) When a cure is a reasonable possibility, the trial court abuses its discretion by not granting leave to amend and a reviewing court must reverse. (Ibid.) 'The burden of proving such reasonable possibility is squarely on the plaintiff.' (Ibid.)" (Mendoza, supra, 140 Cal.App.4th at p. 1402.) Duty of Care to Beneficiaries and Successor Trustee in Drafting Estate Plan
Boykin contends Dana cannot maintain an action for professional negligence against him, because he did not owe a duty of care to the beneficiaries for their disappointed expectations. We conclude Boykin did not owe a duty of care to Dana and Urick-Stasa as beneficiaries or to Dana as trustee for alleged drafting errors on the ground that Dana and Urick-Stasa should have received a larger share of the estate relative to other beneficiaries. However, Dana and Urick-Stasa, as beneficiaries, and Dana, as trustee, can maintain an action against Boykin for alleged errors that reduced the trust's assets or prevented the beneficiaries from receiving the gifts expressly set forth in the trust. Since the complaints allege at least one act for which Boykin had a duty to each of the plaintiffs, the motion for judgment on the pleadings cannot be granted on the basis that Boykin had no duty.
A. Elements of Professional Negligence Generally
"The elements of a claim for professional negligence are: '"(1) the duty of the professional to use such skill, prudence, and diligence as other members of his profession commonly possess and exercise; (2) a breach of that duty; (3) a proximate causal connection between the negligent conduct and the resulting injury; and (4) actual loss or damage resulting from the professional's negligence."' (Osornio[ v. Weingarten (2004)] 124 Cal.App.4th [304,] 319[ (Osornio)].)" (Paul v. Patton (2015) 235 Cal.App.4th 1088, 1095 (Paul).) "'A key element of any action for professional malpractice is the establishment of a duty by the professional to the claimant. Absent duty there can be no breach and no negligence.' [Citation.]" (Skarbrevik v. Cohen, England & Whitfield (1991) 231 Cal.App.3d 692, 700-701.) "While negligence is ordinarily a question of fact, the existence of a duty is generally a question of law that may be addressed by demurrer." (Paul, supra, 235 Cal.App.4th at p. 1095.)
B. Duty of Estate Planning Attorney to Beneficiaries
Historically, an attorney owed a duty of care to a client based on privity of contract and could not be held liable to a nonclient for professional negligence. (Chang v. Lederman (2009) 172 Cal.App.4th 67, 76 (Chang).) However, in Biakanja v. Irving (1958) 49 Cal.2d 647, 650-651 (Biakanja), the Supreme Court rejected the strict privity requirement and established a balancing test to determine whether a defendant would be held liable to a third party who was not in privity. The Supreme Court refined the balancing test in Lucas v. Hamm (1961) 56 Cal.2d 583 (Lucas), to include the following factors: (1) "the extent to which the transaction was intended to affect the plaintiff"; (2) "the foreseeability of harm to him"; (3) "the degree of certainty that the plaintiff suffered injury"; (4) "the closeness of the connection between the defendant's conduct and the injury"; (5) "the policy of preventing future harm"; and (6) "whether the recognition of liability . . . would impose an undue burden on the profession." (Id. at pp. 588-589.)
The Supreme Court explained, "When an attorney undertakes to fulfill the testamentary instructions of his client, he realistically and in fact assumes a relationship not only with the client but also with the client's intended beneficiaries. The attorney's actions and omissions will affect the success of the client's testamentary scheme; and thus the possibility of thwarting the testator's wishes immediately becomes foreseeable. Equally foreseeable is the possibility of injury to an intended beneficiary. In some ways, the beneficiary's interests loom greater than those of the client. After the latter's death, a failure in his testamentary scheme works no practical effect except to deprive his intended beneficiaries of the intended bequests. . . . only the beneficiaries suffer the real loss." (Heyer v. Flaig (1969) 70 Cal.2d 223, 228, disapproved on other grounds in Laird v. Blacker (1992) 2 Cal.4th 606, 617.)
Courts have found attorneys owe a duty of care to beneficiaries when a will or trust clearly states the testator's intent that the designated beneficiary receive a specific benefit. (Chang, supra, 172 Cal.App.4th at p. 82.) In each case, the will or trust expressed the decedent's intent to provide a particular benefit to a named beneficiary, but the gift failed because of a defect in another provision or in the execution of the instrument. (See, e.g., Biakanja, supra, 49 Cal.2d at p. 648 [notary public owed duty to named beneficiary of a will that failed because it was not properly attested]; Lucas, supra, 56 Cal.2d at p. 591 [attorney owed duty to named beneficiaries of testamentary trust that arguably violated the rule against perpetuities]; Bucquet v. Livingston (1976) 57 Cal.App.3d 914, 923-924 (Bucquet) [attorney owed duty to named beneficiaries of inter vivos trust for the adverse tax consequences caused by general power of appointment]; Heyer v. Flaig, supra, 70 Cal.2d at pp. 226-227 [attorney owed duty to beneficiaries named in will that failed to provide for testator's impending marriage]; Garcia v. Borelli (1982) 129 Cal.App.3d 24, 27-28 [attorney owed duty to named beneficiaries for advising decedent that a description in the will of community property held in joint tenancy was sufficient to establish characterization of the property]; Osornio, supra, 124 Cal.App.4th at p. 312 [attorney owed duty to named caregiver-beneficiary for failing to advise testator that a certificate of independent review was required].)
"In short, the testator's intent to benefit the plaintiff is a prerequisite to the imposition of a duty on the attorney to the plaintiff." (Paul, supra, 235 Cal.App.4th at p. 1098.) As the Lucas court explained, the main purpose of the agreement between the attorney and the testator is to benefit the people named in the instrument, "and this intent can be effectuated, in the event of a breach by the attorney, only by giving the beneficiaries a right of action." (Lucas, supra, 56 Cal.2d at p. 590.)
When there is a question about the decedent's intent, however, and a potential beneficiary claims the will or trust did not accurately express the testator's intent, courts will not recognize a duty to a potential beneficiary. (Chang, supra, 172 Cal.App.4th pp. 82-83.) In Radovich v. Locke-Paddon (1995) 35 Cal.App.4th 946, 965 (Radovich), the appellate court found the attorney owed no duty to a potential income beneficiary of a charitable remainder trust that was never executed. The attorney had delivered a draft to the testator, who was undergoing cancer treatment and died without signing it. (Id. at p. 952.) Finding the attorney had no duty to the potential beneficiary to issue reminders to the testator about the steps necessary to execute the document, the Radovich court stated, "we see both practical and policy reasons for requiring more evidence of commitment than is furnished by a direction to prepare a will containing specified provisions. From a practical standpoint, common experience teaches that potential testators may change their minds more than once after the first meeting. Although a potential testator may also change his or her mind after a will is signed, we perceive significantly stronger support for an inference of commitment in a signature on testamentary documents than in a preliminary direction to prepare such documents for signature. From a policy standpoint, we must be sensitive to the potential for misunderstanding and the difficulties of proof inherent in the fact that disputes such as these will not arise until the decedent—the only person who can say what he or she intended—has died. Thus we must as a policy matter insist on the clearest manifestation of commitment the circumstances will permit." (Id. at p. 964.)
In Ventura County Humane Society v. Holloway (1974) 40 Cal.App.3d 897, 902 (Ventura), the attorney who drafted the decedent's will to provide a share of the estate to "Society for the Prevention of Cruelty to Animals (Local or National)" did not have a duty to the charities who were potentially beneficiaries of the gift to investigate the true intention of the testator and draft an unambiguous will. As the Ventura court explained, "The primary duty is owed to the testator-client and the attorney's paramount obligation is to serve and carry out the intention of the testator. Consequently, when, as in the case at bench, the testamentary intent has been implemented, no good reason exists why the attorney should be held accountable for using certain words suggested or selected by the testator which later prove to be ambiguous. In addition, the task of proving whether claimed ambiguity was the result of negligence of the drafting attorney or whether it was the deliberate choice of the testator, would impose an insurmountable burden on the parties, since in such a case the trier of fact would be required to decide this crucial issue without the benefit of the testimony of the most important witness, the testator himself. Once recognized, such a duty would apply by parity of reasoning not only to wills, but also to contracts, conveyances and other legal instruments. The duty thus created would amount to a requirement to draft litigation-proof legal documents. This unlimited liability, as the learned trial judge aptly observed, would result in a speculative and almost intolerable burden on the legal profession indeed." (Id. at pp. 904-905.)
The attorney in Boranian v. Clark (2004) 123 Cal.App.4th 1012, 1015, drafted a will for Marlene Farris, which she signed days before her death. The will gave a laundromat to her new husband and the remainder of her estate to her children. The Boranian court found the attorney owed no duty to the children to ascertain whether Farris had the testamentary capacity to make a new will. (Id. at p. 1018.)
In Chang, the appellate court found an attorney did not have a duty of care to a named trust beneficiary concerning a proposed revision of the trust. (Chang, supra, 172 Cal.App.4th at pp. 83-84.) Before the decedent married Chang, he executed a trust that provided her with $30,000, among other provisions, and left the residue of his estate to his son. (Id. at pp. 72-73.) He also executed a will disposing of assets in Israel. One month later, the decedent executed an amendment to the trust which reduced the gift to Chang to $15,000 and eliminated a specific bequest to another individual. After their marriage, the decedent executed a second will which did not provide anything to Chang, but did not revoke the amended trust. Several months after marriage, the gravely ill decedent instructed his attorney to revise the trust to leave his entire estate to Chang. The attorney refused, fearing litigation, and advised the decedent to have a psychiatric evaluation before changing his estate plan. Chang contended that because she was an expressly named intended beneficiary of the decedent's trust, the attorney owed her a duty of care not only to exercise ordinary skill in drafting the trust to preserve the $15,000 gift, but also with respect to the proposed revision of the estate plan to give her the entire estate.
The Chang court concluded that the first five Biakanja/Lucas factors weighed in favor of extending the attorney's duty of care to include Chang, but no duty was owed based on the sixth factor. (Chang, supra, 172 Cal.App.4th at pp. 83-84.) As the court reasoned, "The difficulty, of course, is that any disappointed potential beneficiary—even a total stranger to the testator—could make factual allegations similar in most respects to those in the second amended complaint; and, without requiring an explicit manifestation of the testator's intentions, the existence of a duty—a legal question—would always turn on the resolution of disputed facts and could never be decided as a matter of law." (Id. at p. 83.) "Without a finite, objective limit on the identity of individuals to whom they owe a duty of care, the burden on lawyers preparing wills and trusts would be intolerable." (Id. at p. 84.)
The Chang court noted "Lucas did not recognize a general duty of care enforceable either by all potential third party beneficiaries or, as Chang suggests, by intended beneficiaries once expressly named in a will, but rather a limited duty, enforceable by the intended beneficiary, to exercise ordinary care and skill to properly effectuate a bequest expressly set forth in the testamentary document. As the Court explained in Heyer v. Flaig, supra, 70 Cal.2d at page 229, '[a]lthough the duty accrues directly in favor of the intended testamentary beneficiary, the scope of the duty is determined by reference to the attorney-client context.'" (Chang, supra, 172 Cal.App.4th at p. 84.)
The Chang court concluded that "a testator's attorney owes no duty to a person in the position of Chang, an expressly named beneficiary who attempts to assert a legal malpractice claim not on the ground her actual bequest (here, the $15,000 gift) was improperly perfected but based on an allegation the testator intended to revise his or her estate plan to increase that bequest and would have done so but for the attorney's negligence. Expanding the attorney's duty of care to include actual beneficiaries who could have been, but were not, named in a revised estate plan, just like including third parties who could have been, but were not, named in a bequest, would expose attorneys to impossible duties and limitless liability because the interests of such potential beneficiaries are always in conflict. [Citation.] Moreover, the results in such lawsuits, if allowed, would inevitably be speculative because the claim necessarily will not arise until the testator or settlor, the only person who can say what he or she intended or explain why a previously announced intention was subsequently modified, has died." (Chang, supra, 172 Cal.App.4th at p. 86.) Since the allegation that the decedent intended to distribute his entire estate to Chang was not based on an express gift in an executed will or trust, the attorney did not owe a duty of care to Chang, and she could not maintain a claim for legal malpractice or breach of fiduciary duty as a matter of law. (Ibid.)
The court has found a duty to named beneficiaries for a drafting error concerning the decedent's intent in only one case, when the attorney admitted in an action to modify the distribution provisions that there was a drafting error and the decedent intended a distribution more favorable to the plaintiff beneficiaries. (Paul, supra, 235 Cal.App.4th at pp. 1092-1099.) In Paul, the decedent directed his attorney, Richard Patton, to draft an amendment to his trust providing certain property to his children, and he executed the amendment believing it contained the intended distribution. (Id. at pp. 1092-1093.) Because of a drafting error, however, the amendment actually divided the property among his children and his second wife. In deposition in an action to modify the amendment, Patton explained the drafting error and stated that the decedent did not intend his second wife to share in the property. (Id. at pp. 1093-1094.) Accepting the facts alleged in the complaint as true for the purposes of demurrer, the Paul court concluded the decedent's donative intent was not ambiguous and the court could not say as a matter of law that the attorney did not owe a duty to the children. (Id. at p. 1099.)
The Paul court found the Biakanja/Lucas factors supported extending Patton's duty of care to include the beneficiary children. (Paul, supra, 235 Cal.App.4th at p. 1099.) As in Chang, the first five factors plainly applied. (Ibid.) The court concluded that under the circumstances of the case, the sixth factor also weighed in favor of finding a duty. (Id. at p. 1100.) "Imposing liability on attorneys to properly define and use basic terms such as 'beneficiaries' and 'children' to carry out the testator's wishes does not impose an undue burden on the legal profession. And, where, as is alleged here, there is no dispute regarding the decedent's intent, the imposition of liability will not compromise the attorney's duty of undivided loyalty to the testator." (Ibid.)
In this case, we conclude Boykin owed a duty of care to the named beneficiaries to draft the provisions of Allyne's estate plan with the requisite skill to effectuate the bequests expressly set forth in the restated trust document. The beneficiaries' complaint alleges several negligent acts, including that: a CRAT was not an appropriate device to achieve Allyne's intended disposition; Boykin drafted a defective CRAT that failed to meet the requirements for favorable tax treatment; the trust provisions did not provide annual payments to the beneficiaries for the length of time that Allyne intended to provide for them or that Boykin represented they would be paid; the trust provisions for Urick-Stasa are contrary to Allyne's intent, because they do not allow the trustee to pay for his maintenance and school tuition; and the distribution did not reflect Allyne's intent because the plan incorrectly included Willis as a beneficiary and provided an unnatural bequest to Phillips Andover. Guided by the principles in Boranian and Chang, we conclude that Boykin did not owe a duty to Dana and Urick-Stasa, as existing named beneficiaries, to draft provisions giving them a greater share of the trust assets by eliminating or reducing the share provided to other named beneficiaries. He did, however, owe them a duty to exercise ordinary care and skill to properly effectuate the bequests that are expressly set forth in the restated trust document. Their allegation that Boykin drafted a CRAT that failed to comply with federal tax laws, resulting in an unnecessary tax burden on the trust estate, is sufficient to state a cause of action for professional negligence. The motion for judgment on the pleadings cannot be granted on the ground that Boykin did not owe a duty to the beneficiaries.
C. Duty of Estate Planning Attorney to Successor Trustee
Dana's complaint in her capacity as successor trustee stated a cause of action for professional negligence for similar reasons.
"An attorney also may be held liable for professional negligence to a successor trustee, despite the fact that the attorney was hired by the original trustee. (Borissoff v. Taylor & Faust (2004) 33 Cal.4th 523, 530-531 (Borissoff).) Such liability is not 'a matter of policy,' but instead is rooted in the Probate Code, which 'gives successor fiduciaries, but not beneficiaries, the same rights as predecessor fiduciaries, including the power to sue for malpractice causing loss to the estate.' (Id. at p. 531.)" (Paul, supra, 235 Cal.App.4th at pp. 1096-1097.)
In Paul, supra, 235 Cal.App.4th at pages 1100-1101, the court found that successor trustees could not state a claim for malpractice against the attorney who erroneously drafted trust provisions to divide certain property among the decedent's second wife and his children. The Paul court stated, "The first amended complaint does not allege facts suggesting any injury to the estate or the trust. Rather, the thrust of the factual allegations is that the Pauls, individually, received a smaller portion of the trust assets than they should have. . . . Because the Pauls neither allege, nor establish that they can allege, harm to the trust, Borissoff and its progeny are inapposite. (Borissoff, supra, at p. 528 [successor fiduciary had standing to sue attorney whose negligence allegedly caused estate to lose ability to claim tax refund]; Stine v. Dell 'Osso (2014) 230 Cal.App.4th 834 [successor conservator had standing to sue attorney who allegedly negligently failed to prevent misappropriation of estate assets]; Smith v. Cimmet (2011) 199 Cal.App.4th 1381, 1387 [successor personal representative may sue attorneys who allegedly prosecuted a meritless lawsuit that unnecessarily expended estate assets].)" (Paul, supra, 235 Cal.App.4th at pp. 1100-1101.)
Similarly, Dana, as successor trustee, cannot state a claim against Boykin for drafting errors concerning Allyne's intended distribution among beneficiaries, because the distribution of the trust assets among the beneficiaries did not harm the trust. She can, however, state a claim against Boykin for drafting errors that caused loss to the trust estate. The allegation that Boykin drafted a CRAT that failed to comply with federal tax laws, resulting in an unnecessary tax burden on the trust estate, is sufficient for the successor trustee to state a cause of action for professional negligence. Statute of Limitations
Dana contends the motion for judgment on the pleadings should have been denied, because the complaints were not barred by the statute of limitations on their face. If the complaints were defective, however, she contends the trial court should have allowed leave to amend. We conclude that the complaints, as currently drafted and considered along with the matters judicially noticed by the trial court, are barred by the statute of limitations. Dana has shown, however, that she can amend the complaints to allege the date of discovery of the claims, as well as tolling agreements, to bring the claims within the statute of limitations.
A. Statute Governing Legal Malpractice
Code of Civil Procedure section 340.6 provides the statute of limitations for a legal malpractice claim: "(a) An action against an attorney for a wrongful act or omission, other than for actual fraud, arising in the performance of professional services shall be commenced within one year after the plaintiff discovers, or through the use of reasonable diligence should have discovered, the facts constituting the wrongful act or omission, or four years from the date of the wrongful act or omission, whichever occurs first. . . . Except for a claim for which the plaintiff is required to establish the plaintiff's factual innocence, the time for commencement of legal action shall not exceed four years except that the period shall be tolled during the time that any of the following exist: [¶] (1) The plaintiff has not sustained actual injury. [¶] (2) The attorney continues to represent the plaintiff regarding the specific subject matter in which the alleged wrongful act or omission occurred. [¶] (3) The attorney willfully conceals the facts constituting the wrongful act or omission when these facts are known to the attorney, except that this subdivision shall toll only the four-year limitation. [¶] (4) The plaintiff is under a legal or physical disability that restricts the plaintiff's ability to commence legal action. [¶] . . . [¶] (b) In an action based upon an instrument in writing, the effective date of which depends upon some act or event of the future, the period of limitations provided for by this section shall commence to run upon the occurrence of that act or event." (Code Civ. Proc., § 340.6.)
Code of Civil Procedure, section 340.6 provides two alternative limitation periods: one year after actual or constructive discovery, or four years after the wrongful act or omission, whichever is first. (Samuels v. Mix (1999) 22 Cal.4th 1, 7; Britton v. Girardi (2015) 235 Cal.App.4th 721, 732.) In either case, the statute of limitations is tolled until the plaintiff has sustained actual injury. (Code Civ. Proc., § 340.6, subd. (a)(1).)
B. Date of Injury
In this case, the alleged wrongful act or omission took place on August 6, 2014, when Allyne executed the restated trust. The statute of limitations was tolled, however, until the trust and the beneficiaries sustained actual injury.
The statute of limitations is tolled during the time that the plaintiff has not sustained actual injury. (§ 340.6, subd. (a)(1).) "This statutory tolling provision is rooted in the required element of 'actual loss or damage' in a professional negligence action. (Budd v. Nixen (1971) 6 Cal.3d 195, 200.) 'If the allegedly negligent conduct does not cause damage, it generates no cause of action in tort. [Citation.] The mere breach of a professional duty, causing only nominal damages, speculative harm, or the threat of future harm—not yet realized—does not suffice to create a cause of action for negligence.' (Ibid.) '[D]etermining when actual injury occurred is predominantly a factual inquiry. [Citations.] When the material facts are undisputed, the trial court can resolve the matter as a question of law. . . .' (Jordache Enterprises, Inc. v. Brobeck, Phleger & Harrison (1998) 18 Cal.4th 739, 751 (Jordache).)" (Croucier v. Chavos (2012) 207 Cal.App.4th 1138, 1147 (Croucier).)
"Actual injury occurs where the plaintiff suffers any loss or injury legally cognizable as damages based on the asserted errors or omissions of an attorney. (Jordache Enterprises, Inc. v. Brobeck, Phleger & Harrison (1998) 18 Cal.4th 739, 743.) The fact of injury or damage need not be recognized or noticed by the plaintiff. Nor does the fact that damage may be difficult to calculate or prove prevent the legal malpractice statute of limitations from running. (Croucier v. Chavos (2012) 207 Cal.App.4th 1138, 1148.) 'Actual injury must be noticeable, but the language of the tolling provision does not require that it be noticed.' (Foxborough v. Van Atta (1994) 26 Cal.App.4th 217, 227.)" (Britton v. Girardi, supra, 235 Cal.App.4th at pp. 732-733.)
"[T]he actual loss of the underlying remedy may remain contingent, that is, the attorney's negligence may have created only the potential for future harm. (Cf. Heyer v. Flaig (1969) 70 Cal.2d 223, overruled on other grounds in Laird v. Blacker, supra, 2 Cal.4th at p. 617 [beneficiary's actionable injury for negligence in drawing of will did not arise until testator's death because no recognized legal rights under will until that time]; Horne v. Peckham (1979) 97 Cal.App.3d 404, 417 [negligent preparation of trust documents did not cause 'actual and true damage . . . until the trust was challenged and plaintiffs were forced to pay legal fees to defend' them]; Fazio v. Hayhurst (1966) 247 Cal.App.2d 200, 203, disapproved on another point in Neel v. Magana, Olney, Levy, Cathcart & Gelfand, supra, 6 Cal.3d at p. 190, fn. 29 [since widow's election was revocable, no 'actual damage' from negligent advice until election was acted upon].)" (Adams v. Paul (1995) 11 Cal.4th 583, 590-591.)
The alleged drafting errors did not cause actual injury until the distribution provisions, including the CRAT, became irrevocable at Allyne's death on August 18, 2015. An action for professional negligence had to be filed within four years, no later than August 18, 2019. The complaints filed on February 28, 2018, were within the statute of limitations, unless the allegations of the complaint established as a matter of law that Dana discovered, or through the use of reasonable diligence should have discovered, the wrongful act or omission triggering the one year statute of limitations to run prior to the filing date of the complaint.
C. Date of Discovery
"Under the discovery rule, the statute of limitations begins to run when the plaintiff suspects or should suspect that her injury was caused by wrongdoing, that someone has done something wrong to her. . . . A plaintiff need not be aware of the specific 'facts' necessary to establish the claim; that is a process contemplated by pretrial discovery. . . . So long as a suspicion exists, it is clear that the plaintiff must go find the facts; she cannot wait for the facts to find her." (Jolly v. Eli Lilly & Co. (1988) 44 Cal.3d 1103, 1110-1111, fn. omitted.)
"Notice may be actual or constructive. (Civ. Code, § 18.) Actual notice is 'express information of a fact,' while constructive notice is that 'which is imputed by law.' (Ibid.) A person with 'actual notice of circumstances sufficient to put a prudent man upon inquiry' is deemed to have constructive notice of all facts that a reasonable inquiry would disclose. (Civ. Code, § 19; see Hobart v. Hobart Estate Co. (1945) 26 Cal.2d 412, 439; 1 Schwing, Cal. Affirmative Defenses[ (2007) Statue of Limitations,] § 25:4, pp. 1340-1341 at fn. 28.)" (E-Fab, Inc. v. Accountants, Inc. Services (2007) 153 Cal.App.4th 1308, 1318-1319 (E-Fab, Inc.).)
The plaintiff's actual or constructive discovery of the attorney's wrongdoing is not an element of a prima facie claim for professional negligence; the defendant has the burden of proving the plaintiff discovered or should have discovered the facts of the alleged wrongdoing more than one year before filing the malpractice action. (Samuels v. Mix, supra, 22 Cal.4th at p. 8.) "Furthermore, '"'[t]he question of when there has been a belated discovery of the cause of action, especially in malpractice cases, is essentially a question of fact . . . [and] [i]t is only where reasonable minds can draw but one conclusion from the evidence that the question becomes a matter of law.' [Citations.]" [Citations.] Further, "where there is a professional relationship, the degree of diligence in ferreting out the negligence for the purpose of the statute of limitations is diminished. [Citation.]" [Citations.]' [Citation.]" (Stueve Bros. Farms, LLC v. Berger Kahn (2013) 222 Cal.App.4th 303, 315.)
"Where a demurrer raises the bar of the applicable statute of limitations, the court assesses whether '"the complaint shows on its face that the statute bars the action."' (E-Fab, Inc., supra, 153 Cal.App.4th 1308, 1315.) Such a defect '"must clearly and affirmatively appear on the face of the complaint; it is not enough that the complaint shows merely that the action may be barred." [Citations.]' (Id. at p. 1316.)" (Czajkowski v. Haskell & White, LLP (2012) 208 Cal.App.4th 166, 174.)
"In making this determination, we also consider facts of which the trial court properly took judicial notice." (Scott v. JPMorgan Chase Bank, N.A. (2013) 214 Cal.App.4th 743, 751 (Scott).) "'"[A] complaint otherwise good on its face is subject to demurrer when facts judicially noticed render it defective." [Citation.]' (Joslin v. H.A.S. Ins. Brokerage (1986) 184 Cal.App.3d 369, 374; see Code Civ. Proc., § 430.30, subd. (a).)" (Evans v. City of Berkeley (2006) 38 Cal.4th 1, 6.) "[T]he court may take judicial notice on its own volition." (Scott, supra, 214 Cal.App.4th at p. 752.) "[Evidence Code] section 452, subdivision (h) provides that judicial notice may be taken of '[f]acts and propositions that are not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.'" (Scott, supra, 214 Cal.App.4th at p. 753.)
The complaints in this case do not allege the date that the plaintiffs discovered the wrongdoing. Boykin asserts that the plaintiffs discovered, or should have discovered, the alleged errors at the time of Allyne's death. Even assuming the successor trustee and the beneficiaries received the trust documents shortly after Allyne's death, however, Boykin has not established that a review of the trust provisions would provide notice of wrongdoing. Boykin contends that Dana would have immediately discovered the provisions for Willis and Phillips Andover that she considered erroneous. However, as explained above, Dana cannot state a cause of action against Boykin as a beneficiary or as a successor trustee for professional negligence based on Allyne's intent to provide for a different distribution. Based on the allegations of the complaints, we cannot say when, as a matter of law, Dana discovered or should have discovered that the CRAT was defective and failed to effectuate the distribution plan that Allyne intended.
Although the allegations of the complaints on their face do not establish that the claims are barred by the statute of limitations for legal malpractice, the court can properly take judicial notice of the fact that Dana filed a petition for reformation of the trust on February 16, 2016, alleging that the trust provisions did not reflect Allyne's intent. The filing date of the reformation petition is not reasonably subject to dispute and is capable of accurate determination from reliable sources. The trial court correctly determined that Dana discovered the alleged wrongdoing no later than February 16, 2016, and since the malpractice complaints were filed more than one year later, the claims were barred by the statute of limitations.
However, Dana has demonstrated that she can amend the complaints to allege that the claims are not barred because the parties entered into a tolling agreement. Dana stated that she did not know of any drafting defects when Boykin provided a copy of Allyne's trust to her accountant. She had no reason to know of any defects in the trust before Boykin sent copies of his correspondence with Allyne on August 31, 2015. Boykin sent a copy of the transcript of the videotaped execution of the estate plan on September 28, 2015. Boykin continued to send documents related to the estate plan through at least the end of September 2015. Allyne's handwritten amendment to the trust was not discovered until October 2015. Dana was not aware of the facts that are the basis for the legal malpractice claims until mid-October 2015 at the earliest. The parties executed a tolling agreement on August 30, 2016.
We note that in her capacity as successor trustee, Dana's personal discovery of alleged wrongdoing is irrelevant if her predecessor trustee, Allyne, had actual or constructive knowledge of the drafting errors. (See Security First Nat. Bank v. Ross (1963) 214 Cal.App.2d 424, 430-431.) "The powers of a trustee are not personal to any particular trustee but, rather, are inherent in the office of trustee. It has been the law in California for over a century that a new trustee 'succeed[s] to all the rights, duties, and responsibilities of his predecessors.' [Citations.]" (Moeller v. Superior Court (1997) 16 Cal.4th 1124, 1131.)
Even if Dana discovered or should have discovered the drafting defects from the initial correspondence that she received from Boykin on August 31, 2015, the tolling agreement was signed on August 30, 2016, and the agreement was extended up to and including February 28, 2018. Dana must be given the opportunity to amend to allege that the complaints filed February 28, 2018, were not barred by the statute of limitations. Collateral Estoppel
Boykin contends that Dana is collaterally estopped by the holding in Urick, supra, 15 Cal.App.5th 1182 from bringing a professional negligence claim against him. This is incorrect. In Urick, there were triable issues of fact as to whether Dana filed a petition to reform the trust in her capacity as a beneficiary, whether the petition was based on allegations of fraud, and whether she had a reasonable basis to believe the petition would be reformed. Willis established a probability of prevailing if the trier of fact accepted his evidence to be true. No findings of fact were made in Urick. The order denying the anti-SLAPP motion in the trust contest did not collaterally estop Dana from maintaining a legal malpractice action based on Boykin's alleged negligence in drafting of the trust.
DISPOSITION
The judgment of dismissal and the order granting the motion for judgment on the pleadings without leave to amend are reversed. The trial court is directed to enter a new and different order granting the motion for judgment on the pleadings with leave to amend to allege the dates of discovery of the claims, as well as the details of the agreements tolling the statute of limitations. Appellant Dana Urick, individually, as guardian ad litem for Trentyn Urick-Stasa and as trustee of the Allyne L. Urick Trust Agreement, is awarded her costs on appeal.
MOOR, J. We concur:
BAKER, Acting P. J.
KIM, J.