There’s an old saying that remodeling a home is like pulling a loose string on a sweater—go too far, and it all unravels. Robert Cundall, John Martin, and Frances Diaz were neighbors and friends before things fell apart.
In 2008, Martin asked Diaz, a lawyer, to prepare an estate plan for him that included a trust (the February Trust) naming Cundall, who was renovating Martin’s West Hollywood house, as the sole beneficiary and successor trustee. The plan stated that Martin, as Grantor and Trustee, could revoke or amend the trust agreement “…by delivering to the Trustee (himself) and his nominated Successor Trustee an appropriate written revocation or amendment signed by the Grantor (himself) and his attorney, Frances L. Diaz.”
Within months, everything went wrong. It may have had to do with Cundall more than doubling Martin’s bill for the renovation to $219,000 from $81,000. Or maybe it was the job that Diaz was doing managing Martin’s finances? Whatever happened, Martin ended up accusing Diaz and Cundall of theft and hiring a new financial manager. He also brought on a new estate lawyer to prepare another trust (“the May Trust”) that removed his erstwhile renovator Cundall as beneficiary and successor trustee. A revocation of the February Trust prepared by the new estate lawyer was served correctly but—importantly—was not signed by Diaz.
Martin died in 2010. Cundall, with Diaz as his lawyer, petitioned the court to find the trust revocation invalid and award all trust assets to him. The Los Angeles probate trial dragged on for 23 days over two years due to health and scheduling challenges.
The issue: Probate Code Section 15401 provides that a trust may be revoked by the statutory process Martin followed. But Cundall framed it for the court this way: By that same statute, this revocation process could not be used because the trust agreement “explicitly” made the language in the document the “exclusive” method of revoking his former friend’s final wishes.
The appeals court rejected Cundall’s argument, and laboriously crafted a definition of “explicitly.” It concluded that “establishing a particular method of revocation does not explicitly make that method exclusive.“ The appeals court cited Webster’s 9th New Collegiate Dictionary: explicitly “implies such verbal plainness and distinctness that there is no need for inference and no room for difficulty in understanding.
Don’t let everything you’ve built collapse under the weight of uncertainty. Do your best to avoid legal wordplay and bring in an experienced estate attorney to draft your documents to make your precise wishes known. Cundall v Mitchell-Clyde, California, Second District, Div. Two, B293952 (2020)
About the Author:
John O’Grady leads a full-service estate and trust law firm in San Francisco. His practice includes Estate Planning & Administration, Probate and Trust Litigation.