This is a tale of a settlor's change of heart and an attorney's inadvertence. Only it's not a tale, it's real. Anyway, Lucia Howrey opened a "Totten Trust" account at Bank of America naming her step-daughter on the signature card as the beneficiary. Later, Lucia executed a revocable trust and identified the account as a trust asset. Lucia also named Gabriella Reeves as the beneficiary of the Bank of America account. Garbriella's son drafted the trust. Lucia died in April 2009. The step-daughter claimed she was the owner of the account because her name appeared on the signature card. On appeal, she argued that Gabriella was disqalified from receiving the money because she was the mother of the drafting attorney.
Under California Probate Code section 5302, the amount left in a Totten Trust account belong to the named beneficiary of the account on the death of the sole trustee of the account unless there is clear and convincing evidence of a different intent. Here, the California Court of Appeals affirmed the Ventura County Superior Court ruling that the Lucia's revocable trust identifying the bank account as a trust asset and Gabriella Reeves as the beneficiary was sufficient evidence of such a different intent. So, the step-daughter could no longer collect the balance in the account as the beneficiary of the Totten Trust.
Here's where the attorney inadvertence comes in. Because Gabriella was the mother of the drafting attorney, there is a rebuttable presumption that she is a "disqualified person" under Probate Code section 21350. The step-daughter's attorney never raised the disqualification issue in his moving papers, and referred to it only obliquely at the hearing. The step-daughter was barred from raising the issue on appeal.
Araiza v. Younkin.
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