Superior Court of Santa Cruz County, No. CIS CV176597 Hon. Rebecca Connolly Judge
[Copyrighted Material Omitted]
Willoughby, Stuart & Bening Bradley A. Bening and Ellyn E. Nesbit for Plaintiffs and Appellants.
Law Offices of Richard L. Francis & Associates and Richard L. Francis for Defendant and Respondent.
The decedent, Gilbert Paul, retained attorney Richard Patton to draft an amendment to his revocable living trust. The decedent signed the “Trust Amendment, ” which, as drafted by Patton, named the decedent’s wife, Helen, and his children, Stephen Paul, David Paul, Alan Paul, and Nancy Dybdahl as beneficiaries. Stephen and David Paul also are the successor trustees of the trust. Following the decedent’s death, they petitioned the probate court to modify the Trust Amendment, alleging it failed to conform to the decedent’s intentions by erroneously granting Helen an interest in the decedent’s brokerage accounts and personal and real property. In connection with that probate court action, Patton admitted the Trust Amendment did not reflect the decedent’s intention that his brokerage accounts and personal and real property be divided among his children. Stephen and David settled the probate court action with Helen.
Subsequently, Stephen, David, Alan, and Nancy (the Pauls) filed the legal malpractice action that is the subject of this appeal against Patton. They alleged that Patton failed to exercise reasonable care in performing legal services for the decedent by failing to draft the Trust Amendment in a manner consistent with the decedent’s intentions. The trial court sustained without leave to amend Patton’s demurrer to the Pauls’ first amended complaint. We shall reverse.
I. Factual and Procedural Background
Because this matter comes to us following a judgment sustaining a demurrer without leave to amend, we assume the truth of the material facts properly pleaded in the Pauls’ operative first amended complaint. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318 [216 Cal.Rptr. 718, 703 P.2d 58] (Blank).) Facts appearing in exhibits attached to the first amended complaint also are accepted as true and are given precedence, to the extent they contradict the allegations. (Dodd v. Citizens Bank of Costa Mesa (1990) 222 Cal.App.3d 1624, 1627 [272 Cal.Rptr. 623].) The exhibits to the first amended complaint were: (1) the Trust Amendment; (2) a December 13, 2011 letter from Patton regarding the decedent’s intent in connection with the Trust Amendment; and (3) a partial transcript of a 2012 deposition of Patton in which he discussed the decedent’s intent in connection with the Trust Amendment. In addition to
the first amended complaint and its exhibits, we also may consider matters subject to judicial notice. (Hill v. Roll Internat. Corp. (2011) 195 Cal.App.4th 1295, 1300 [128 Cal.Rptr.3d 109].) The Pauls request that we take judicial notice of the amended petition to modify the Trust Amendment filed in the probate court action and its exhibits, which include the decedent’s original revocable living trust. We grant that request pursuant to Evidence Code sections 452 and 459. Accordingly, the following factual recitation is based on the facts properly pleaded in the first amended complaint, facts appearing in exhibits attached to the first amended complaint, and facts appearing in the amended petition to modify the Trust Amendment and its exhibits.
A. The 1995 Trust
The Pauls are the decedent’s four children with his first wife, who died in 1970. The decedent married Helen in 1988. At that time, he had substantial separate property, including real property referred to as “the Quick Stop Property, ” other real property, brokerage accounts, and personal property.
In 1995, the decedent established a revocable living trust (the “1995 Trust”) under which he was both trustor and trustee. The 1995 Trust provided that if Helen survived the decedent, she would have the right to live in (or lease) the marital home for the rest of her life and to receive the net income from the Quick Stop Property. The rest of the decedent’s property was to be divided among his children, the Pauls. Upon Helen’s death, the Pauls were to receive the decedent’s one half community property interest in the marital home.
B. The Trust Amendment
The decedent’s health and his relationship with Helen began to decline in 2009. In 2011, he retained Patton to amend the 1995 Trust.
As drafted by Patton and executed by the decedent, “the Trust Amendment” defines “beneficiaries” as “Trustor’s adult children: Stephen Paul, Alan Paul, David Paul and Nancy Dybdahl (in equal shares, share and share alike) and Trustor’s spouse Helen C. Paul.”
In a section entitled “Marital Home, ” the Trust Amendment states “[i]t is Trustor’s wish that the marital home be sold after his death.” It provides that, upon the sale of the home, half the net proceeds from the sale shall go to Helen and the other half shall be distributed to “Trustor’s beneficiaries.”
With respect to the income from the Quick Stop Property, the Trust Amendment directs the successor trustees “to use up to $4, 000 per month” of that income “to pay for ...