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Pena v. Dey

California Court of Appeals, Third District, Sacramento

August 30, 2019

MARGARET PENA, as Trustee, etc., Plaintiff and Respondent,
v.
GREY DEY, Defendant and Appellant.

          APPEAL from a judgment of the Superior Court of Sacramento County No. 34201500178593, Steven M. Gevercer, Judge. Affirmed.

          Law Office of Dewey V. Harpainter, Dewey V. Harpainter and Nathan R. Harpainter for Defendant and Appellant.

          F.S. Ricky Maveety for Petitioner and Respondent.

          HOCH, J.

         In this case, we must determine whether James Robert Anderson, settlor and trustee of the James Robert Anderson Revocable Trust (the trust), validly amended the trust when he made handwritten interlineations to one of the operative trust documents, specifically the First Amendment to the trust (First Amendment), making Grey Dey a beneficiary. After making the interlineations, Anderson sent both the original trust instrument and the interlineated First Amendment to his attorney to have the new disposition of his trust estate formalized in a second amendment to the trust. Anderson died before the formal amendment was prepared for his signature.

         Margaret Pena, successor trustee, petitioned the trial court for instructions as to the validity of the interlineations. She thereafter moved for summary judgment, asserting the interlineations did not amount to a valid amendment to the trust as a matter of law. The trial court granted the motion and entered judgment in Pena's favor. Dey appeals.

         We conclude the interlineations did not validly amend the trust because the trust specifically requires amendments “be made by written instrument signed by the settlor and delivered to the trustee.” (Italics added.) While the law considers the interlineations a separate written instrument, and while there can be no doubt Anderson delivered them to himself as trustee, he did not sign them. Instead, he sent them to his attorney to have them formalized into a second amendment to the trust and prepared for his signature, evidencing his intent to sign the changes to his trust at a later date. We also reject Dey's argument that Anderson effectively signed the interlineations by attaching a Post-it® note to the documents he sent to his attorney, on which he stated: “Hi Scott, [¶] Here they are. First one is 2004. Second is 2008. Enjoy! Best, Rob.” We cannot conclude these lines on the note were part of the written instrument comprised of the interlineations to the First Amendment to the trust such that the signature on the note effectively signed the interlineations. Instead, Anderson signed a separate note indicating what the enclosed documents were. While there is no dispute in this case that Anderson intended Dey to receive a portion of his trust estate, there is also no genuine dispute that Anderson intended to sign this and other changes to his trust when formalized by his attorney. Unfortunately, he died before that could be accomplished. We must therefore affirm the summary judgment entered in this case.

         FACTS

         In 2004, Anderson executed the trust at issue in this appeal. He was designated both settlor and trustee. Paragraph 3.1 of the trust provides: “Power of Revocation and Amendment. This trust may be amended, revoked, or terminated by the settlor, in whole or in part, at any time during his lifetime. After the settlor's death, this trust shall be irrevocable and not subject to amendment.” Paragraph 3.2 provides: “Method of Revocation or Amendment. Any amendment, revocation, or termination of this trust shall be made by written instrument signed by the settlor and delivered to the trustee. An exercise of the power of amendment substantially affecting the duties, rights, and liabilities of the trustee shall be effective only if agreed to by the trustee in writing.”

         In 2008, Anderson executed the First Amendment to the trust in compliance with the foregoing method of amendment. We need not set forth the contents of this amendment in any detail. It will suffice to note the amendment added paragraph 5.5, dividing the remainder of the trust estate into shares of various percentages for 15 named beneficiaries.

         Anderson was diagnosed with abdominal cancer in 2010. While he recovered from that bout with the disease, he was diagnosed with brain cancer the following year. Dey moved in with Anderson in November 2011 and cared for him until his death in May 2014. Dey and Anderson had been friends since 2006. Anderson, a successful artist and art teacher, was also Dey's mentor in the art world. The two became close during 2010 and throughout Anderson's battle with cancer.

         In February 2014, Anderson called an attorney, Michael S. Shuttleworth, who had represented Anderson in another matter, seeking his assistance in making changes to his estate planning documents. Because Shuttleworth was not the attorney who drafted the 2004 trust instrument or the 2008 First Amendment, he asked Anderson to send copies of these documents to his office and “put in writing the proposed changes he was considering.”

         Around this time, Anderson made the interlineations at issue in this appeal. Eleven of the fifteen shares provided for in paragraph 5.5 of the First Amendment were crossed out. The first 4 shares remained, but these beneficiaries' respective percentages of the remainder (49 percent) of the trust estate were changed to 7 percent. Dey and two other individuals were listed in the margin as also receiving “7% of 49%, ” i.e., 7 percent of the remainder of the trust estate. Also in the margin, Anderson wrote, “51% to 3 organizations ~ See beneficiary list.”

         Shuttleworth received the trust instrument and interlineated First Amendment to the trust in March 2014. As mentioned, attached to these documents was a Post-it® note, on which Anderson wrote: “Hi Scott, [¶] Here they are. First one is 2004. Second is 2008. Enjoy! Best, Rob.” An initial draft of a second amendment to the trust was prepared by Shuttleworth's staff. However, Shuttleworth's review of that draft caused him to call Anderson the following month seeking ...


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