Opinion
NOT TO BE PUBLISHED
Contra Costa County Super. Ct. No. P0001154
Jones, P.J.
James Branscom, Jr., appeals contending the trial court erred when it denied his request to modify a trust. We agree the requested modification was appropriate and reverse.
I. FACTUAL AND PROCEDURAL BACKGROUND
The trust at issue was created by Margaret G. Branscom (hereafter Trustor) by declaration on July 8, 1977, and was amended by her on August 5, 1979. The trust provided that the Trustor was entitled to all income generated by the trust during her lifetime. It further provided that upon the Trustor’s death, her son, appellant, and his spouse, were entitled to the trust’s income. Upon the death of the appellant and his spouse, the trust’s income and ultimately its corpus would be distributed to the Trustor’s grandchildren.
The trust as amended named the Trustor, appellant, and Frank C. Whittelsey as cotrustees. If the any of them were unable to act, the trust named Philip C. Stork, (the attorney who drafted the trust) and United California Bank as successor cotrustees. The trust contained no other provision for appointment of a successor cotrustee. It was silent on the requirement of a bond.
The Trustor died in 1990, leaving appellant and Whittelsey as the sole cotrustees. In 2003 Whittelsey, who was having health problems, wanted to resign as cotrustee. However, neither of the designated successor cotrustees could act. Stork had been removed by the court for ethical improprieties, and California Federal Bank, the successor-in-interest to United California Bank, declined to serve. Therefore, Whittelsey filed a petition asking the court to accept his resignation and asking that Louise Watson Branscom (appellant’s wife) be appointed as cotrustee.
The trial court issued a tentative ruling that indicated a bond would have to be posted before a new cotrustee could be appointed. Because the cost of such a bond would be prohibitive, Whittelsey decided to withdraw his petition.
Because Whittelsey still wanted to resign, the cotrustees came up with a new plan. In May 2006, they filed a petition under Probate Code section 15409 to amend the trust. They sought two changes. First they sought to insert the following new clause that would govern successor trustees:
Unless otherwise indicated, all further section references will be to the Probate Code.
Section 15409, subdivision (a) states, in part, “On petition by a trustee or beneficiary, the court may modify the administrative or dispositive provisions of the trust . . . if, owing to circumstances not known to the settlor and not anticipated by the settlor, the continuation of the trust under its terms would defeat or substantially impair the accomplishment of the purposes of the trust.”
“If any co-trustee named in this instrument is, for any reason, unable or unwilling to continue to act as co-trustee, he or she may resign the office and appoint an alternate or successor co-trustee to carry out the terms and provisions of the . . . Trust, with the same powers, rights, discretions, obligations, and immunities as the original co-trustee. Any such appointment shall require the consent of each adult income beneficiary and the parent or guardian of each minor income beneficiary, and may be made only by an instrument in writing signed by the original co-trustee and delivered to each adult income beneficiary, the parent or guardian of each minor income beneficiary, and the co-trustee being appointed.”
In addition, the petition sought to add the following new clause regarding bonds:
“No bond shall be required of any trustee of the trust provided for in this instrument, whether named in this instrument, appointed by the court, or otherwise appointed in the manner set forth in this instrument.”
Appellant submitted a declaration stating that both changes were consistent with his mother’s, i.e., the Trustor’s intent. He said his mother “consciously strived to keep administrative expenses low, so that the bulk of the Trust assets could be used to benefit her family members.” He also said his mother “did not see the need to require bond. She trusted the beneficiaries and her nominated trustees and did not require bond in her trust instrument. . . . She would have viewed any bond expense as needless and a waste of money. I believe adding language to the trust to waive the requirement of a bond would be in keeping with my mother’s wishes for the efficient and orderly administration of the Trust and its assets.”
The cotrustees also submitted declarations from all the adult beneficiaries of the trust stating they consented to the proposed modifications. The cotrustees even secured the services of a guardian ad litem who agreed to represent the interests of any of the Trustor’s as-yet-unborn grandchildren.
The trial court refused to grant approval of the requested modifications, ruling that it would violate section 15602 to allow an unnamed trustee to serve without bond.
This appeal followed.
II. DISCUSSION
The sole issue in this case is whether the trial court properly refused to grant the proposed trust modifications. The court below denied the cotrustees’ request ruling that allowing a unnamed trustee to serve without bond would violate section 15602. As is relevant, that section states:
“(a) A trustee is not required to give a bond to secure performance of the trustee’s duties, unless any of the following circumstances occurs:
“[¶] . . . . [¶]
“(3) An Individual who is not named as a trustee in the trust instrument is appointed as a trustee by the court.
“(b) Notwithstanding paragraphs (1) and (3) of subdivision (a), the court may excuse a requirement of a bond. . . . The court may not, however, excuse the requirement of a bond for an individual described in paragraph (3) of subdivision (a), except under compelling circumstances. For the purposes of this section, a request by all the adult beneficiaries of a trust that bond be waived for an individual described in paragraph (3) of subdivision (a) for their trust is deemed to constitute a compelling circumstance.” (Italics added.)
The statutory language is clear. Absent “compelling circumstances” an unnamed trustee must be bonded. One statutorily mandated “compelling circumstance” is when all the adult beneficiaries of a trust request that a bond be waived. That is precisely what occurred here. All the adult beneficiaries of the trust consented to the proposed modifications, and requested that the requirement of a bond be waived. Under section 15602, subdivision (b), the court should have granted the cotrustees’ request.
III. DISPOSITION
The order is reversed and the case is remanded with directions to grant the requested modification.
We concur: Needham, J. Stevens, J.
Retired Associate Justice of the Court of Appeal, First Appellate District, Division Five, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.