California Court of Appeals, Third District, Sacramento
1/18/17 opinion vacated
from a judgment of the Superior Court of Sacramento County,
No. 34-2012-00116836-PR-TR-FRC Matthew J. Gary, Judge.
Affirmed in part and reversed in part with directions.
William P. Roscoe, III for Plaintiff and Appellant Anthony
Hill and Dennis B. Hill for Defendant and Appellant Karen
Offices of Jerilyn Paik, Jerilyn Paik, and Stephanie R.
Poston for Defendant and Respondent.
Reynoso, in pro. per., for Real Party in Interest and
NICHOLSON, Acting P. J.
acrimonious family squabble erupted over the property of the
deceased patriarch and spilled over into the courts. The
patriarch-settlor appointed defendant Melissa P. Reynoso (a
granddaughter of the settlor) as trustee. In this proceeding,
the trial court determined Reynoso was the most reliable and
credible of the family members. The trial court found that
other family members were not credible.
sold real property of the trust to Karen Bartholomew (a
daughter of the settlor). Plaintiff Anthony Pizarro (a
grandson of the settlor) filed a petition for relief against
Reynoso concerning the sale of the real property. The court
denied the petition and ordered Pizarro and others to pay the
trust's attorney fees and costs.
appeal, Pizarro contends the trial court erred in finding
that Reynoso acted properly as trustee. However, he fails to
make a focused, organized, and coherent argument for why we
must reverse the order. We therefore conclude he forfeited
appeal, Pizarro and Bartholomew contend that the award of
attorney fees and costs against them was improper. We
conclude that the attorney fees and costs were properly and
lawfully imposed under the trial court's equitable power
over the trust, except to the extent the trial court made
Pizarro and Bartholomew personally liable for attorney fees
and costs, rather than liable solely from their shares of the
therefore reverse the award of attorney fees and costs to the
extent it imposed personal liability. In all other respects,
Earl Jensen died in 2011, leaving his property, including
real property, in a trust. His children included plaintiff
Keith Jensen (who is not a party to this appeal) and
defendant and appellant Karen Bartholomew. Bartholomew has
two children: plaintiff and appellant Pizarro and defendant
and respondent Reynoso. Reynoso was named trustee.
real property at issue in this proceeding is located on El
Verano Avenue in Elverta. Reynoso sold the property to
Bartholomew, as permitted by the trust.
and Jensen filed petitions under Probate Code section 17200
against defendants Reynoso (as trustee) and Bartholomew.
Principally, the petitions alleged that Reynoso breached her
duties as trustee and that the sale of the property to
Bartholomew must be set aside. After trial, the court denied
the petitions and awarded attorney fees and costs, which
award we discuss in more detail later.
there remains on appeal a degree of dispute concerning the
facts, we relate the statement of decision, which is the fact
finder's conclusion concerning the facts. We quote
(without quotation marks) the main body of the statement of
principal controverted issue presented herein is whether the
sale of the property located at 9021 El Verano Avenue,
Elverta, CA, by the Trustee MELISSA REYNOSO, to KAREN
BARTHOLOMEW, was a “sham sale” as alleged by
Petitioners ANTHONY PIZARRO and KEITH JENSEN. It was not. The
court finds that the sale was a valid sale and made in good
faith by the Trustee REYNOSO to the beneficiary KAREN
two primary witnesses to the transactions involved in the
sale were MELISSA REYNOSO and KAREN BARTHOLOMEW. The court
finds MELISSA REYNOSO'S testimony to be credible and
convincing. The court finds KAREN BARTHOLOMEW'S testimony
to be, in large part, incredible and unconvincing.
or about February 14, 2010, decedent and Settlor, Willis Earl
Jensen, executed his Will. On or about February 16, 2010, he
executed his Living Trust. For reasons that became obvious at
trial, Mr. Jensen appointed his granddaughter, Trustee
MELISSA REYNOSO, as Successor Trustee to succeed him at his
death, rather than appointing any of his children or other
Living Trust, by reference to the Last Will and Testament of
Willis Earl Jensen executed February 14, 2010, states,
“Property located at 9021 El Verano Avenue, Elverta,
Ca. 95626 (parcel #202-0020-012-0000) to be sold to (My
Daughter) Karen Bartholomew or any of her children at 100k
below appraised value. If Karen or her children are unable to
purchase property then property to be sold for fair market
value. After all debts and fees have been satisfied monies
are to be equally divided to my children, except as noted; If
any of my children are deceased then their share gets equally
divided among their children and Marilyn Kimbrell's share
gets equally divided among her children.”
El Verano property appraised for $365, 000. Therefore, the
property could be sold to either BARTHOLOMEW, REYNOSO, or
PIZARRO for $265, 000. The decision of who to sell the
property to was left to Trustee REYNOSO.
Settlor's intent was for either BARTHOLOMEW, or REYNOSO,
or PIZARRO, to buy the property. The decision of who to sell
it to was left to Trustee REYNOSO.
Pursuant to the terms of the Trust, Trustee REYNOSO could
have sold the El Verano property directly from the Trust to
herself. (Estate of Carrie Hazeltine Thompson (1958) 50
Cal.2d 613, 616.) For reasons stated in her testimony, she
did not. Instead, she sold the property to her mother,
BARTHOLOMEW, for $265, 000.
Prior to sale, Trustee REYNOSO gave proper
Notice(s) as required by law.
Prior to the sale, BARTHOLOMEW represented orally, and by
confirming letter from her counsel, that she expected a
personal injury settlement to come in that would be in excess
of the $265, 000 purchase price. Trustee REYNOSO agreed to
help her mother BARTHOLOMEW purchase the property. Trustee
REYNOSO and her husband, Miguel, applied for a loan from
Wells Fargo Bank, which loan was approved. BARTHOLOMEW would
repay REYNOSO when her personal injury settlement monies came
in. The sale transactions included the following:
October 23, 2012, Trustee REYNOSO executed a Grant Deed(s)
transferring El Verano from the Trust to herself and her
husband Miguel. Concurrently, she executed the corresponding
Note and Deed(s) of Trust to WFB [Wells Fargo Bank]. This was
done because the Wells Fargo Loan was not a Trust obligation;
it was an individual loan to REYNOSO and her husband.
WFB loan closed on or about October 23, 2012, and the loan
funds of approximately $262, 000 were immediately
deposited into Trust on behalf of BARTHOLOMEW. The Trust was
October 25, 2012, BARTHOLOMEW executed her Promissory Note
for $265, 000 to REYNOSO and her husband Miguel. This was
consistent with the agreement REYNOSO and BARTHOLOMEW had by
which REYNOSO would help BARTHOLOMEW purchase the property by
obtaining a loan in REYNOSO's name (because BARTHOLOMEW
could not qualify for a loan on her own) and then BARTHOLOMEW
would pay REYNOSO back when BARTHOLOMEW'S personal injury
settlement monies came in.
October 26, 2012, after the WFB loan proceeds were secured
and placed in the Trust, REYNOSO and her husband Miguel
executed Trust Transfer Deed(s) transferring the property
from themselves back to Trustee REYNOSO.
October 26, 2012, concurrent with the Trust Transfer Deed(s)
identified in d. above, Trustee REYNOSO executed a Trust
Transfer Deed(s) transferring the property from the Trust to
These transactions occurring, for all practical purposes,
concurrently, constitute a valid sale of the El Verano
property from the Trustee to BARTHOLOMEW, all in accordance
with the provisions of the Trust. There is nothing
“sham” about this transaction as Petitioners
PIZARRO and JENSEN allege. The Trust received the net
proceeds of sale of approximately $262, 000 and title to the
property passed from the Trust to BARTHOLOMEW. That is a
“sale”. The proceeds of the sale remain in the
From the point of sale to BARTHOLOMEW, the El Verano property
was no long[er] Trust property. The cash from the sale now
sitting in the Trust is Trust property. What occurred between
BARTHOLOMEW and REYNOSO thereafter is “outside”
of the ...