Wednesday, September 24, 2008
C.A. Construes Temporary Judge’s Continuing Jurisdiction Narrowly
By SHERRI M. OKAMOTO, Staff Writer
The First District California Court of Appeal held that the temporary judge assigned to hear a family’s dispute over their mother’s estate, which has dragged on for over 15 years, did not have continuing jurisdiction to hear the latest battle over the sale of a substantial real property asset from the trust estate.
Div. Two reversed the probate court decision referring the dispute to retired First District Justice Harry Low, concluding that Low was only authorized to resolve trust-related proceedings pertaining solely to disputes among Elsie N. Gridley’s surviving family.
When Gridley died, her will provided that her property was to be divided equally among her four children; Michael Gridley, Robert Gridley, Christine Bennett and Patricia Gridley. Michael Gridley was appointed executor of the probate estate.
Shortly thereafter, the children’s father, Arnold Gridley, attempted to exercise a right of survivorship with respect to most of Elsie Gridley’s assets. Arnold Gridley and his children attempted to resolve this dispute by entering into a settlement agreement in August 1993. San Francisco attorney Benjamin R. Winslow also signed the agreement as counsel for the four children.
The agreement called for the establishment of an irrevocable trust, with Michael and Arnold Gridley serving as co-trustees. The trust would hold Elise Gridley’s share of community property and provide “income for life” to Arnold Gridley, with the remainder distributed to the children upon his death.
After disputes regarding the agreement arose, Michael and Arnold Gridley entered into a stipulation that Low would be appointed as a temporary judge to hear “[a]ll issues necessary for a complete determination of the cause, as determined by the pleadings on file and which are then at issue… together with such additional issues as the parties, from time to time, may stipulate to be heard and adjudicated by the Temporary Judge, but not to include final distribution and final accounting.”
Low conducted a total of 16 hearings and four family meetings with the beneficiaries over the next 18 months. Each of the four children retained independent counsel who also attended these meetings.
In March 1, 1996, Low filed an order transferring the probate case to the probate court for approval of the final accounting and distribution of the estate, and final distribution was made in April.
Nearly seven years later, the trust estate sold a 1,836 acre property in Dixon, California to Michael and Robert Gridley, who in turn conveyed the property to a corporation they had created and co-owned with Winslow and others.
In 2006, Bennett and Patricia Gridley filed suit against their brothers and the other co-owners of the Dixon property alleging fraud and other wrongdoing connected to the land sale.
Michael and Robert Gridley argued that Low had continuing authority to hear the challenge filed by their sisters, and San Francisco Superior Court Judge John Dearman agreed. He returned the matter to Low to render a determination of the matters Low was authorized to hear.
Low found that he had authority to decide most of the causes of action in the sisters’ complaint, and rejected Bennett and Patricia Gridley’s motion to disqualify Winslow from representing their brothers due to a conflict of interest.
Bennett and Patricia Gridley filed two separate appeals and petitioned for a writ of mandate.
The appellate court consolidated the claims, and in an opinion by Justice Paul R. Haerle, concluded that Low was not authorized to hear the sisters’ claims regarding the land sale even though Low was properly appointed a temporary judge in the original dispute regarding the accounting and distribution of the testator’s estate.
Haerle explained that Bennett and Patricia Gridley implicitly consented to the appointment of Low as a temporary judge by participating without objection in the multiple meetings before Low during probate administration.
However, Haerle noted Low was empowered by the stipulation to act as a temporary judge only until the final determination of the “cause” that was assigned to him, which Haerle reasoned was the resolution of issues between Arthur Gridley and his children impeding the final distribution of the probate estate.
Because Bennett and Patricia Gridley’s complaint was filed almost 10 years after the probate estate closed and almost two years after Arnold Gridley had died, and alleged substantive claims against third parties who were not beneficiaries of the probate matter, Haerle wrote it “does not effect a continuation of the probate proceedings or question in any way the finality of the disposition of [the] probate case.”
Thus Haerle concluded it was “an ancillary proceeding completely separate from the probate case, which will be heard on its own record and result in an independent judgment.”
Low also lacked authority to rule on the disqualification motion for Winslow because his power as temporary judge did not extent to the adjudication of the 2006 land sale case, Haerle added.
But, “for the record,” Haerle cautioned that the court harbored “grave concerns” about the propriety of Wislow’s apparently conflicting roles as attorney for the trust estate and as a partial owner of the property in dispute.
Presiding Justice J. Anthony Kline and Justice James A. Richman joined Haerle in his opinion.
The case is Gridley v. Gridley, A118084.
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