Wednesday, November 15, 2017
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Court of Appeal:
Trust Assets Wrongfully Diverted From Great-Grandchildren
Slaying of Intended Beneficiary Requires, Under Anti-Lapse Statute, That Property Go To His Children; Judicial Error Promoted by Devious Special Administrator
By a MetNews Staff Writer
A judge erred in awarding the bulk of an estate to a deceased mother’s two sons who were not mentioned in a trust and were expressly disinherited in her will, except for a bequest of $1 each, the Court of Appeal for this district has held, taking issue with actions of a special administrator who, it found, steered the judge into making unauthorized orders.
Justice Steven Z. Perren of Div. Six said the intended beneficiary was a grandchild of the decedents—Dorothy Barrios and Joseph C. Barrios Sr., who set up the trust in 1996—and the fact that the anticipated recipient predeceased his widowed grandmother means, he declared, that the proceeds must go to his children, now minors.
The grandchild, Larry Joseph Barrios—referred to in the opinion as “Lawrence, Jr.”—was “fatally shot in 2003,” Perren noted. According to news reports at the time, Larry Barrios was implicated in illicit drug-dealing and his slaying was related to his being “from the underworld,” as a deputy district attorney was quoted as saying in connection with the prosecutions.
Anti-Lapse Statute
Ventura Superior Court Judge Glen Reiser’s award of the lion’s share of the assets to the renounced sons, Perren said, was the product of his failing to give “proper effect” to the anti-lapse statute, Probate Code §21101. That section provides that “if a transferee is dead when the instrument is executed, or fails or is treated as failing to survive the transferor...the issue of the deceased transferee take in the transferee’s place....”
The 1996 trust of Dorothy and Joseph C. Barrios Sr., proprietors of a janitorial business, designates grandson Lawrence Barrios Jr. (son of their deceased son Lawrence Barrios Sr.) as successor trustee and beneficiary. Dorothy Barrios’s will, providing for $1 to sons Joseph Barrios Jr. and Ronald Barrios, was contemporaneously executed.
Dorothy Barrios died, at age 88, on Sept. 3, 2016.
Perren wrote:
“Though Lawrence, Jr. predeceased Dorothy, neither the Will nor the Trust requires that he outlive his grandparents. Dorothy did not amend either instrument during the 13 years following Lawrence, Jr.’s death, to name a different beneficiary or devisee. Under these circumstances the specific transfers to Lawrence, Jr., must pass to appellants pursuant to the anti-lapse statute, Probate Code section 21110.”
Special Administrator Appointed
The sons nominated Angelique Friend, president of Probate Services Inc., to be special administrator of Dorothy Barrios’s estate. She petitioned for letters of administration, claiming that the decedent had died “intestate,” failing to attach the will.
The court granted the appointment.
Friend argued that in light of Lawrence Barrios Jr. having predeceased his mother, the Trust “fails for lack of a beneficiary” so that assets of the estate should “be distributed pursuant to the laws of intestate succession.”
A guardian ad litem was appointed to represent the children of Lawrence Barrios Jr., who produced the will and petitioned for a probate. They contended that “the Trust does not fail and the testator’s probate assets should be distributed pursuant to her Will, not pursuant to the laws of intestate succession.”
Trial Court’s View
Reiser declared that the will “specifically disinherits” the sons, but that does not affect the trust, assets of which included the family house.
The judge noted that the trust has a residuary clause providing that trust assets would revert to the settlors’ estates if the assets are “not specifically and validly disposed of.” Applying the anti-lapse statute, he awarded each son a third of the assets, with the great-grandchildren dividing the other third.
That, Perren said, was the wrong approach.
“Contrary to the probate court’s belief, the anti-lapse statute applies to the specific beneficiary clause, not to the residuary clause,” he said. “The residuary clause does not sweep in failed and lapsed gifts, such as the one to Lawrence, Jr.”
He said it “bears emphasizing” that when the trust was executed in 1996, neither of the great grandchildren—born in 2001 and 2003—was yet alive, and was because Lawrence Barrios Jr, had no children that the residuary was inserted.
Intent Is Clear
Perren went on to say:
“Lawrence, Jr. is the ‘specific beneficiary’ in the Trust and the named devisee of the Will. The Will lists respondents and disinherits them with a $1 devise. Viewing the entire scheme of disposition, it is clear that Dorothy did not intend to leave anything to respondents. The omission was not an oversight; Dorothy did not forget that she had two living sons.”
The jurist added:
“The early death of Lawrence, Jr.; Dorothy’s failure to amend or revoke the Will and Trust after his death; and the existence of a residuary clause do not defeat effect of the anti-lapse statute….A testator’s failure to change the will after the death of a devisee evidences an intent that the gift should pass to the dead devisee’s children, and not be apportioned among decedent’s surviving siblings.”
Removal of Friend
Perren said that, as requested by the minors’ counsel, Friend must be removed as special administrator.
“He recited that she knew the decedent had a will but represented to the court that she died intestate, evidencing bias in favor of the disinherited sons, and filed a brief siding with them.
“Going forward, Friend should not serve as administrator for children whose interests she opposes,” Perren said, adding:
“[T]hose who take under a will have priority in nominating an administrator.”
Given that the sons will receive no part of the estate, he said, the minors’ choice, not theirs, should be honored.”
The case is Estate of Barrios, B281686.
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