Opinion
NOT TO BE PUBLISHED
Alameda County Super. Ct. No. RP08375928
RUVOLO, P. J.
I.
Introduction
On March 11, 2008, Barbara “Bobbie” Simi (appellant) filed a petition concerning the disposition of Bud Herman Krusi’s estate (decedent). The purpose of the petition was to seek a determination from the court as to whether the Bud Krusi Trust, created by decedent on September 24, 2002 (the 2002 trust), had been revoked in whole or in part by a will executed by decedent in September 2007 (the 2007 will). Decedent’s 2007 will did not make any reference to the 2002 trust, but then disposed of certain specifically described trust property in a manner different from the disposition made in the trust instrument.
The trial court found that decedent’s 2007 will did not contain a clear and unambiguous manifestation of his intent to revoke the trust in its entirety; therefore, the court held that the effect of the 2007 will on the 2002 trust was limited to the modification required with respect to the specific trust assets mentioned in the 2007 will. Appellant, who is simultaneously the executrix and largest single beneficiary specified under the 2007 will, appeals claiming “[a]t the conclusion of its independent review, this court should determine that the 2007 will revoked the 2002 trust entirely.” We disagree and affirm the judgment.
II.
FACTS AND PROCEDURAL HISTORY
On September 24, 2002, decedent executed a revocable trust and a pour-over will. At the time of the execution of these estate planning documents, decedent was a widower who had four living children: Paul Krusi, Peter Krusi, Karl Krusi, and Joan Gardiner.
Decedent named himself trustee of the trust. Decedent’s son Paul Krusi was nominated to serve as successor trustee, and appellant was named as second successor trustee. The 2002 trust contains “Exhibit A, ” which specifically references substantial real property and personal assets that were transferred into the trust, including (1) all interest in Easy Overhead Door Company, Inc., a California corporation; (2) business real estate on Cleveland Avenue in Albany, California; (3) residential real property on Solano Avenue in Albany, California; and (4) accounts with Charles Schwab & Company and H.R. Mann Company.
Decedent conveyed those assets to himself as trustee when he established the trust. Decedent indicated that after his death, he wanted his trust estate distributed as follows: The Solano Avenue residential real property and its furnishings were given equally to Paul Krusi and Sarah Gersper. The remaining trust assets were given to Paul Krusi, Peter Krusi, and Joan Gardiner equally or to their issue by right of representation. Decedent’s son Karl Krusi and all of Karl’s lineal descendants were expressly disinherited.
In the trust instrument, decedent retained the right to amend or revoke the trust at any time by written instrument delivered to the trustee. Specifically, the trust provided that “During the lifetime of the Settlor, this Trust may be revoked in whole or in part by an instrument in writing signed by the Settlor and delivered to the Trustee.” (Italics added.) Similarly, the trust provided that the “Settlor may at any time during the Settlor’s lifetime amend any of the terms of this instrument by an instrument in writing signed by the Settlor and delivered to the Trustee.”
Concurrent with the creation of the trust, decedent executed a pour-over will. Pursuant to the terms of the will, decedent gave the residue of his estate, including “jewelry, furniture and furnishings, clothing, personal automobiles, and other tangible articles of a personal nature” to the trustee of the trust, “to be held administered, and distributed according to the terms of [t]he [t]rust....”
A pour-over will operates in conjunction with a decedent’s trust. The pour-over will causes any portion of decedent’s estate not already included in the trust to become a trust asset, and to be distributed to the trust beneficiaries on the terms provided by the trust. (See, e.g., Conservatorship of Davidson (2003) 113 Cal.App.4th 1035, disapproved on other grounds in Bernard v. Foley (2006) 39 Cal.4th 794, 816, fn. 14.)
In September 2007, seven months before his death, decedent executed a new will. The preamble of the 2007 will indicates that it was decedent’s intent to revoke “all wills and codicils, if any, that I have previously made.” Under the terms of the 2007 will, appellant was named as “executor of this will, to serve without bond.” The 2007 will gave appellant a 51 percent interest in the business corporation, Easy Overhead Door Company, Inc., and in the business real estate on Cleveland Avenue in Albany. The will explained that it was decedent’s “intention to give [appellant] a ‘controlling’ interest in the business in the event that any disagreements might arise with respect to the conduct of the business.” In a separate provision, the 2007 will indicates decedent’s intent to “give the residue of my estate to my surviving issue by right of representation”; however, any gift given to a person who contests the will “shall be void.” The 2007 will makes no express mention of the previous 2002 trust and pour-over will.
Decedent died on March 7, 2008. On March 11, 2008, appellant filed a petition to “Determine Existence or Non-Existence of Trust and for Construction Thereof if it Exists.” Appellant sought a declaration that decedent, by making the 2007 will, effectively revoked the trust in its entirety. As a consequence, she claimed that the record titles of the various assets held in the trust should be ordered changed to show title in Barbara “Bobbie” Simi in her capacity as executrix under the 2007 will.
Paul Krusi, in his capacity as trustee of the trust, filed an objection to the petition alleging that the 2007 will did not revoke the trust in its entirety. He argued “the fact that the 2007 [w]ill is inconsistent with the Bud Krusi Trust, ” with respect to a 51 percent interest in decedent’s business and business property, “does not, by itself, constitute clear and convincing evidence that [d]ecedent intended to revoke the Bud Krusi Trust as to these assets.”
The parties waived presentation of extrinsic evidence and submitted the matter to the court for its decision solely on the three pivotal documents––the 2002 trust, the 2002 pour-over will, and the 2007 will. After a lengthy oral argument held on July 20, 2009, the court issued a written decision on July 27, 2009. The decision states that “the 2007 will amended, modified, or revoked the trust with respect to a fifty-one percent (51%) interest in the ownership of Easy Overhead Door Company, Inc., a California corporation and with respect to a fifty-one percent (51%) interest in the real property at 650 Cleveland Avenue, Albany, Alameda County, California, on which the business was located, but the 2007 will did not affect the dispositive or other provisions of the trust, nor any of the assets of the trust, in any other respect.”
Thus, pursuant to the court’s decision, the dispositional provisions of the 2007 will were given effect by giving appellant a 51 percent share of Easy Overhead Door Company, Inc., and a 51 percent interest in the Cleveland Avenue property. However, the remaining 49 percent interests in these assets passed equally to Paul Krusi, Peter Krusi, and Joan Gardiner via the trust. With regard to the remaining assets, the assets that had been placed in the 2002 trust were to be distributed according to the terms of the trust and whatever assets were held outside of the trust were to be distributed in accordance with the terms of the 2007 will. Appellant filed this appeal. Respondents have notified this court of their decision not to file a brief based “solely on a cost-benefit analysis of what it would take to respond to Simi’s appeal”
III.
DISCUSSION
The 2002 trust instrument clearly permitted decedent to revoke or amend the trust during his lifetime “by an instrument in writing signed by the Settlor and delivered to the Trustee.” In Gardenhire v. Superior Court (2005) 127 Cal.App.4th 882 (Gardenhire), the court examined a factual scenario analogous to the one before us and held that a subsequently executed will could constitute “an instrument in writing” sufficient to revoke a previously executed trust in accordance with the revocation provisions of the trust. As in this case, the trust in Gardenhire expressly allowed the trustor to revoke the trust by “written notice” signed by the trustor and delivered to the trustee. (Id. at p. 886.) When the trust was created in Gardenhire, the trustor named herself trustee, as in this case. (Id. at p. 885.) Years after creating the trust, the trustor executed a will which expressly revoked all prior wills and, while not specifically mentioning the trust, stated her intent “ ‘to dispose of all real and personal property which I have the right to dispose of by Will....’ ” (Id. at p. 886.)
Upon her death, the beneficiaries battled about whether the original trust was revoked by the subsequently executed will. (Gardenhire, supra, 127 Cal.App.4th at p. 886.) The trustee of the trust (Gardenhire) filed a summary judgment motion seeking a determination that, as a matter of law, the trustor could not have revoked the trust by executing a will. The trial court denied the motion; and the Sixth District Court of Appeal affirmed. The appellate court reasoned that the term “written notice, ” as used in the revocation provision of the trust, was neither limited nor qualified; and it therefore authorized revocation by “any writing that unambiguously manifested [the decedent’s] intent to revoke, including a will.” (Id. at p. 888.) Because the trustor was also the trustee, she could revoke by giving herself written notice of her intent to do so. “Since she could not be mistaken about her own intent no matter how she chose to manifest it in writing, the broad, unqualified language of the trust reasonably implies that she did not intend to restrict the form of written notice or the nature of the documents used to provide it. Rather, any writing that unambiguously manifested her intent would do.” (Ibid., italics added.)
Consequently, under Gardenhire, decedent’s 2007 will could serve as written notice to revoke or modify the 2002 trust as long as there is an unambiguous manifestation of decedent’s intent to do so. (Gardenhire, supra, 127 Cal.App.4th at pp. 888, 893.) The pivotal question in this case is the extent to which decedent’s 2002 trust distribution should be deemed to have been changed by the 2007 will. Appellant contends that by executing the 2007 will, decedent exercised his right of revocation to the trust in its entirety––not merely “carving out the 51% interests in the business assets, ” as the trial court found. She urges this court to determine that decedent’s “general dispositive plan” was set forth in the 2007 will under which “he intended by the will to dispose of all of his assets including assets that were then or at some time had been in the trust.” For support of this argument, she relies on the provision of decedent’s 2007 will, which gives “the residue of my estate to my surviving issue by right of representation....” She claims there is “no good reason to think that because the residuary clause [in the 2007 will] did not mention the trust or trust assets that for that reason it did not refer to the trust assets.”
In considering appellant’s arguments, the first rule is that decedent’s intent, as expressed in the 2007 will, controls. (Newman v. Wells Fargo Bank (1996) 14 Cal.4th 126, 134.) The second rule is that, in the absence of extrinsic evidence, we must interpret the 2007 will as a matter of law. (Ibid.; Estate of Dodge (1971) 6 Cal.3d 311, 318; Estate of Russell (1968) 69 Cal.2d 200, 213.) The third rule is that we are not to presume that the lower court’s interpretation was correct. (Estate of Dodge, supra, 6 Cal.3d. at p. 318, fn. 4.)
Since we cannot find an unambiguous manifestation of decedent’s intent to revoke the trust in its entirety, as required by Gardenhire, we agree with the trial court’s interpretation of the 2007 will. The preamble to decedent’s 2007 will states, “I revoke all wills and codicils, if any, that I have previously made.” If these words are given their ordinary meaning, they do not reflect an intention to revoke any other kind of testamentary instrument, such as a trust.
The only specific assets mentioned in the 2007 will are the Easy Overhead Door Company, Inc. and the real property at Cleveland Avenue “on which my business is located.” Decedent’s desire to alter his estate plan with respect to these business assets is explained in the will itself. “Ms. Simi shall have the right to continue operating Easy Overhead Door Company as a going concern after my death.” Consequently, “[i]t is my intention to give Ms. Simi a ‘controlling’ interest in the business in the event that any disagreements might arise with respect to the conduct of the business.” Thus, the general plan and dominant purpose of decedent’s 2007 will was to “revoke all [previous] wills and codicils” and devise a controlling interest in his business to appellant. That intent is perfectly clear; and in effectuating that intent, the trial court properly found that appellant is entitled to a controlling percentage of decedent’s business assets.
However, appellant claims that decedent also intended to revoke or terminate the 2002 trust and that he expressed his desire to pass his entire estate, regardless of its prior status, according to the 2007 will. She relies on the following general residuary language that was added in a separate provision of the 2007 will: “I give the residue of my estate to my surviving issue by right of representation....” The trial court found that these words, if given their natural meaning, did not unambiguously express decedent’s intent to revoke the trust. Instead, the court believed the will’s residuary clause was ambiguous, and could be interpreted to merely express decedent’s intent to direct the disposition of any portion of decedent’s estate that was not otherwise effectively disposed of in decedent’s estate plan.
We agree and find such boilerplate language, which is routinely employed for making a complete disposition of any forgotten property not specifically disposed of and avoiding intestacy, does not express the requisite unambiguous manifestation of decedent’s intent to revoke the trust or to govern the disposition of trust assets. The residual clause contains no language indicating that decedent believed and understood that he was taking assets out of the trust and disposing of them according to the 2007 will. As such, this court can do nothing more than speculate as to whether decedent intended to dispose of all of his property by executing a new will. Since Gardenhire articulates that what is required is an unambiguous manifestation of the intent to revoke the trust, we agree with the trial court’s conclusion that decedent’s 2007 will did not revoke the trust, but simply modified the distribution of the specifically described trust assets. (Gardenhire, supra, 127 Cal.App.4th at pp. 888, 893.)
A residuary gift is a transfer of property that remains after all specific and general gifts have been satisfied. (Prob. Code, § 21117, subd. (f).) The term “residuary clause” is not specifically defined in the Probate Code, but is commonly understood as functioning essentially as a catch-all provision which ensures that the will disposes of all property which remains after other dispositions are satisfied. (14 Witkin, Summary of Cal. Law (10th ed. 2005) Wills and Probate, § 243, pp. 322-323.)
IV.
DISPOSITION
The judgment is affirmed.
We concur: SEPULVEDA, J. RIVERA, J.