Opinion
A149398
07-11-2018
Estate of CAROL A. MORRIS, Deceased. MICHAEL J. SCARDINO, Petitioner and Respondent, v. KENNETH J. RICCARDI, Objector and Appellant.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (San Mateo County Super. Ct. No. PRO126781)
Kenneth J. Riccardi, son of the late Carol A. Morris, appeals from two probate orders made in connection with a petition by Michael J. Scardino, Riccardi's uncle and trustee of the Carol A. Morris Revocable Trust, which became irrevocable upon Morris's death. The probate court ordered (1) that Riccardi and his family vacate and surrender possession of a residential property belonging to the trust and that the property be sold, and (2) that Riccardi pay $2,750 per month in rent to the trust while remaining on the property.
Riccardi contends the probate court erred when it: denied his request to abate the probate proceedings pending resolution of Riccardi's civil action against Scardino; refused to consider extrinsic evidence of Morris's alleged intent that Riccardi is entitled to buy out his sister's share of the residential property; and ordered Riccardi to pay fair market rent during the pendency of his appeal. We affirm.
BACKGROUND
In September 2014, Carol Morris established a trust naming herself as trustee, and upon her death, naming her brother Michael Scardino as successor trustee. On the same day that she executed the trust documents, Morris transferred the residential property in dispute, located in San Bruno, to the trust. Morris had been diagnosed with cancer and at the time was residing with Scardino. Riccardi and Riccardi's own son and his girlfriend, and their three children, continued to live at the San Bruno property.
Article IV of the trust provides for the disposition of trust assets upon Morris's death as follows: "Upon the death of Settlor, the successor Trustee shall pay all estate and inheritance taxes, including interest and penalties, arising as a result of the Settlor's death, shall pay the Settlor's last illness and funeral expenses, and all expenses and costs (including reasonable attorney's fees) incurred in the administration of the Settlor's probate estate, and the valid debts of the Settlor. [¶] 1. My account at First National Bank of Northern California shall be given to Lisa Jones and from it she shall give the sum of ten thousand ($10,000.00) dollars to each of my grandchildren, namely, Joshua Jones, Stephanie Fowler, Kelsey Riccardi and Kenneth W. Riccardi, Jr. The balance of funds in the account shall be retained by Lisa Jones. [¶] 2. All the rest of my property shall be given equally to Lisa Jones and Kenneth J. Riccardi, share and share alike. [¶] 3. If my real property is to be sold, it shall be sold by Michael J. Scardino, realtor, and he shall be entitled to receive the normal fees paid to realtors for selling real property. [¶] 4. All the rest and residue of the Trust estate, including all lapsed and failed gifts, and the rest and residue of Settlor's estate, shall be given to Lisa Jones and Kenneth J. Riccardi equally, share and share alike."
Morris died on July 31, 2015.
Six months later, on February 23, 2016, Riccardi filed a complaint in the superior court against Scardino alleging breach of fiduciary duty and requesting an accounting (the civil proceeding).
The gist of this action was that Scardino had failed to pay off the mortgage on the San Bruno property with funds Morris had received from a settlement with PG&E in connection with the San Bruno pipeline explosion and had also failed to allow Riccardi to acquire Jones's half interest in the property "at the fair market value thereof at the time of her death." There are no allegations, however, that Riccardi had made any offers to purchase his sister's interest in the property or that he had asked for an independent appraisal of the property.
A month later, in March, Scardino, as trustee, filed a verified Probate Code section 850 petition in the probate court to, inter alia, establish trust ownership and possession of the San Bruno property, and to remove Riccardi and his son and his son's family from the property (the probate proceeding). Scardino alleged, among other things, that Riccardi claimed to be "the owner" of the property and was refusing to allow access so it could "be prepared for sale or shown to prospective interested parties." He further alleged that Riccardi was refusing to contribute to the mortgage payments "even though [he] is equally liable" with his sister for the payments. Accordingly, the entirety of the mortgage was being paid from the bank account that Morris had left solely to Jones.
All further statutory references are to the Probate Code unless otherwise indicated.
The petition also sought to confirm the validity of the trust and to confirm Scardino as trustee.
Scardino then asked the superior court in the civil proceeding to consolidate the civil and probate proceedings.
Riccardi opposed consolidation and additionally asserted the probate proceeding should be abated pursuant to section 854 pending resolution of the civil proceeding. Riccardi claimed, among other things, that his mother had promised him she would pay off the mortgage and make repairs with the settlement monies and that he would have the opportunity to buy out his sister's interest and thus remain in the house, and that his sister had agreed he could do so. He thus maintained Scardino had a "duty" to him "to discuss with him how such a buyout could be accomplished." He further maintained Scardino had been in a rush to evict him and his family, and had engaged in abusive tactics to do so, in order to obtain a commission on the sale of the house. He also asserted, in his supporting declaration, that his sister, Jones, "had long been jealous" of his close relationship with their mother. He also maintained Jones and Scardino had colluded and pressured Morris into executing the trust documents, and that within three weeks of Morris's death, Scardino (acting as the trustee and through his lawyer) sent him an eviction notice to vacate the property. Riccardi then recounted that Scardino had twice attempted to pursue unlawful detainer cases against him. He complained that Scardino had never provided an accounting of trust assets and, despite Morris's assurance Riccardi could buy out his sister's interest in the house, Scardino "ha[d] never made any proposal for how [he] could buy [out his] sister's share." Riccardi did not recount that he had made any offers to purchase his sister's half interest or that he had proposed obtaining an independent appraisal of the property.
In his supporting declaration, Riccardi described his experience as a direct victim of the San Bruno pipeline explosion and fire. He claimed he now suffers from PTSD and chronic depression. After the fire, Riccardi and Scardino apparently strongly disagreed as to whether Morris, who had not been home at the time of the explosion, should seek additional compensation from PG&E beyond that reimbursing the property damage settlement she had received from her insurer. Morris ultimately joined in an injury claim with Riccardi. They received a settlement, which required allocation as between Morris and Riccardi. Apparently, Morris wanted half, but Riccardi objected and "agreed" to 30 percent and "only did so" after his mother promised to use the funds to pay off the mortgage and repair the explosion and fire damage. In short, Riccardi viewed the settlement monies as entirely his own.
In reply, Scardino claimed Riccardi had filed the civil proceeding "for one purpose and one purpose only—delay, delay, delay." According to Scardino, Riccardi was far from the "saint" he portrayed himself as being, and that he had been fired from his job and evicted from his apartment, was deeply indebted to the IRS, and had been supported by his mother for many years. He had never paid rent, nor paid any part of the mortgage, nor paid any of the utilities. Scardino stated the property was "in a terrible state of disrepair." He knew, based on his experience as a realtor, that comparable properties in the neighborhood were selling for more than $1 million, and if it was cleaned up and painted, it would sell for "at least the neighborhood average." Scardino denied all of Riccardi's accusations, asserted Morris had been afraid of Riccardi's son (who Scardino claimed was a heroin and meth addict), and recounted incidents where Riccardi displayed threatening behavior when Scardino attempted to marshal the trust assets.
Scardino stated Jones had no objection to Riccardi buying out her half interest in the property, but then observed the trust proceeding had been pending for eight months, and Riccardi had "yet to make an offer other than an informal one, which was to value the property at $600,000." Scardino described this offer as "absurd on its face," given that "[c]omparble properties in the neighborhood [were] selling for sums in excess of $1 million."
After a hearing, the superior court, on April 25, 2016, granted Scardino's motion to consolidate. Three days later, Riccardi moved for reconsideration, which was eventually denied. On May 4, the superior court ordered that all further pleadings be filed in the probate court.
We take judicial notice of the San Mateo County Superior Court's Register of Actions in both the civil and probate proceedings. (See Evid. Code, § 452, subd. (d)(1).)
As far as we are able to determine from the superior court's register of actions, the parties have nevertheless continued to file documents in the civil proceeding. However, no action by the superior court is relevant to this appeal. Rather, only orders by the probate court are at issue.
In the meantime, on April 21, Riccardi filed a response in the probate court to Scardino's section 850 petition, reasserting his accusations against Scardino and Jones. Riccardi once again asserted the probate proceeding should be abated pursuant to section 854 pending resolution of the civil proceeding. He also notably failed to describe any offers made to buy out Jones's share of the property. Rather, in a footnote, he stated he "stands ready to pay Lisa half its current value in its current state of repair" (more accurately, its current state of disrepair) so he and his family could continue residing there.
At a May 2 hearing on the section 850 petition, the probate court asked for additional briefing and evidentiary submissions as to delay (or nondelay) before making a decision on whether to abate the probate proceeding.
Some two weeks later, on May 13, Jones executed a declaration which was apparently filed with the probate court on May 30. She declared that the day before their mother's death, Riccardi had told her she "could do nothing to remove him from the house," and about a week later offered to buy out her interest without an appraisal provided Scardino did not receive a commission. According to Jones, Riccardi had "wanted to offer [her] $150,000 and leave the house under [their] mother's name because of his tax problems." She further averred Riccardi had refused to allow an appraiser selected by Scardino to value the property and was refusing to contribute toward the mortgage and property taxes. In her view, Riccardi was trying to force the depletion of the bank account that was to be distributed to her.
In a declaration filed May 23, Riccardi reiterated all his grievances against Scardino and Jones. He disputed Jones's statements about his efforts to buy out her interest in the property. He claimed he "never ceased negotiations with her" and that he "continued to try to discuss a buyout," but she refused. He asserted he had made a $300,000 offer for her half interest which he intended "to be the start [to] negotiations between us," but neither she nor Scardino responded. Riccardi admitted to not paying either rent or any part of the mortgage, but claimed that was because Jones and Scardino refused to negotiate a buyout. He claimed, however, that "technically" he was paying the mortgage because the funds in the bank account that was to be distributed to Jones had come from his settlement with PG&E, which he had given his mother only upon her promise she would use the funds to pay off the mortgage.
Riccardi's attorney submitted a declaration stating that on or about April 22, he and Scardino's attorney started to discuss mediation and retaining an appraiser. He contacted two appraisers, one recommended by Scardino. After more than a week of attempting to arrange for a mediation, Scardino's attorney told him Jones had changed her mind and wanted the house sold. The attorneys, including an attorney for Jones, then resumed discussions, which were ultimately not successful. Riccardi's attorney's view was that Scardino and Jones were simply stalling.
Scardino's and Jones's attorneys filed declarations disputing Riccardi's view of events. Scardino's attorney maintained Riccardi had not, in the 10 months since Morris's death, made a serious offer to buy out Jones's share, and shortly before Morris died had "made it plain" Jones would never get the house and he would "bankrupt" her. He claimed Riccardi had "refused" to allow any appraiser but his own onto the property and was also under the impression his appraiser's value would control. Jones's attorney reported that, at the last minute, Riccardi tried to cancel the appointment for the appraiser she had scheduled to visit the property, a cancellation she did not receive until the appraiser had already gone to the house and been refused access.
Riccardi filed a reply declaration further detailing his grievances and disputes with Scardino and Jones. He admitted he had refused to allow Scardino onto the property, claiming he was in "fear for my life" because of Scardino's efforts to evict him and because Scardino carried a gun. He accused Jones of stealing everything she could from the trust estate. He disputed that he had never made a fair offer for Jones's share of the property, referring to the $300,000 offer he had made. He further stated he had obtained an appraisal only the month before which had valued the property at $850,000, and he therefore had increased his offer to $350,000. This appraisal, however, provided a date of death value, not the current fair market value of the property. Riccardi nevertheless characterized his most recent offer as "very generous," opining that he believed even the date of death value was overstated by $150,000. Stating he believed the principal owing on the mortgage was also $150,000, he offered to assume it and pay Jones $350,000. He also claimed he had agreed to a new date for Jones's appraiser to inspect the property, but opined that "if the appraiser" was a true professional, "the appraised value should be no more than $850,000"; indeed, Riccardi believed it should be "significantly less."
Following a hearing on June 24, 2016, the probate court issued a six-page written order on July 22, denying Riccardi's request for abatement of the probate proceeding. The court ruled the "subject matter of [the] civil action for damages . . . is different from the subject matter of the probate action confirming the validity of the trust, confirming the trustee, providing possession of property owned by the trust to the trustee, and selling trust property so that the proceeds may be distributed to the beneficiaries." The court further ruled that even if the two proceedings "were viewed as having some overlap," the civil proceeding "was clearly filed for purposes of delay." The court observed that Riccardi had lived at the San Bruno property since 1991 and had made no mortgage payments since January 2011; the mortgage was currently being paid from a "cash account owned by the trust . . . in which the balance is to go to [Riccardi's sister] Lisa Jones"; the property was in disrepair because of Riccardi; Riccardi's refusal to vacate the premises has precluded the trustee from preparing the property for sale and being shown to interested parties; and Riccardi had offered to buy out Jones's share for only $350,000 based on an $850,000 date of death appraisal that he further believed overstated the value of the property even as of that date. The court, thus, found that the "facts before this court, suggest that Kenneth J. Riccardi's current strategy is to delay administration of the trust estate while offering to purchase the interest of his sister (whose funds are currently being used to make mortgage payments) at an amount significantly below the current fair market value of the property." The court also issued an order to show cause (OSC) why Riccardi should not be ordered to vacate the property.
A week later, on August 1, Riccardi moved for reconsideration of the probate court's order refusing to abate the probate proceeding and issuing an OSC requiring him to vacate the property. Riccardi claimed the order was based "on several erroneous conclusions" and maintained he had not sought to delay administration of the estate, but rather had been trying to buy out his sister's share of the property. He claimed that in criticizing his $350,000 offer to his sister, the probate court had overlooked that the mortgage on the property was approximately $150,000. He further claimed that he had, as of April 27, offered to pay half of "all mortgage payments, taxes and insurance going forward," and that any disrepair to the house "had nothing to do with the occupancy or deferred maintenance by the residents."
At a hearing on September 13, the probate court first took up Riccardi's motion for reconsideration of the court's refusal to abate the probate proceeding and issuance of the OSC. Riccardi claimed Scardino and Jones had "caused [the] delay" because they continuously "blocked" any buyout offer he presented. He asserted that after his initial $350,000 offer, Jones had countered with a $438,400 figure, which Riccardi claimed was a "bonanza" and "highly inflated." He acknowledged he had no right to reside on the property rent free, but maintained that had Jones accepted his $350,000 buyout offer, "there would have not been a need for rent."
Scardino, in turn, claimed Riccardi had refused to speak with him and refused to agree to a global settlement. As far as Scardino was concerned, Riccardi was bent on "bankrupt[ing] the trust."
Jones's view was much the same. She claimed Riccardi "only want[ed] to focus on the purchase of the house, and not the settlement of the case," and that "[f]or some reason Mr. Riccardi does not understand that a trust administration involves debts, costs, fees," and rent.
The probate court granted Riccardi's motion for reconsideration, but observed that while he had presented some "new facts supporting reconsideration," they were "slim, barely sufficient." Upon reconsideration, the court made "the same orders it made in its prior determination. . . . None of the new facts or claims support a change in the ultimate determination of the court. Therefore, in the end, the prior determination is reaffirmed."
The probate court then turned to Riccardi's claim that the dispositional language of the trust was "ambiguous" and that the court should consider extrinsic evidence that allegedly established Morris had intended that Riccardi buy out his sister's share of the property. Riccardi claimed the extrinsic evidence showed "clearly, and without any—it is one-sided, undisputed," that Morris's intent had been that Riccardi had the "right" to buy the property and additionally had the right to buy it at the fair market value as of the date of Morris's death. In support of these claims, Riccardi offered (1) a text message from his sister, Jones, saying Morris had told Scardino that Riccardi "had the first right to buy the house" and (2) a statement in Scardino's declaration that Morris "told me that it was for both of her children equally and that if her son wanted to buy out her daughter's interest, she would have no objection."
Scardino maintained, in turn, that "there is absolutely no evidence whatsoever that Carol Morris intended Mr. Riccardi to get this house," that Morris left the property to both her children equally, that she could have left the house to Riccardi as she had done with the bank account to his sister, but she did not do so, and that both Scardino and Jones "indicated that Ms. Morris would have had no objection if Ken was to buy out Lisa's interests, and we said that all along, it is a question of the price." Scardino pointed out the property belonged to the trust, Riccardi had lived there since Morris's death rent free, the mortgage, insurance and taxes were all being paid from the proceeds of the bank account left to his sister, and his $350,000 buyout figure was unacceptable, given that a house down the street had sold for $1,230,000.
When Riccardi again pointed to the text message from Jones and the declaration by Scardino, the probate court interrupted, stating "[t]he problem is that your suggestion flies in the face of the specific language of the trust that does not provide for that. It provides for equal separation of the trust assets, could not be a simpler trust." Riccardi nevertheless continued to insist that the language of paragraph 3 of Article IV—stating "If my real property is to be sold" (italics added)—created "enough of an ambiguity to look at the extrinsic evidence, and the extrinsic evidence does say, all one-sided that says, mom told Uncle Mike you should have the first choice in buying the house."
The court ultimately ruled that "[c]omments after the fact by the beneficiaries of trustees, with regard to settlement negotiations, do not create ambiguity in a trust document. I can see no justification for any determination of ambiguity in the trust documents sufficient to consider extrinsic evidence here. The trust could not be simpler." The court then ordered Riccardi and his family to vacate the property by September 30, noting he was "free to make an offer to purchase the property for a specific sum, as is anyone else. The trustee is to accept the offer most beneficial to all the beneficiaries, not one of them, all of them." The court also ordered the parties to brief the issue of fair market rent and scheduled a future hearing on that issue. Approximately one week later, on September 22, the probate court issued a written order memorializing its rulings on Riccardi's motion for reconsideration and the lack of ambiguity in the trust.
In the meantime, on September 16, three days after the September 13 hearing but before the probate court issued its written order on September 22, Riccardi filed a notice of appeal from the probate court's September 13 minute order.
Shortly thereafter, the issue of an undertaking on appeal came up. We are able to discern this procedural chronology from the court's register of actions—the record on appeal contains none of the documents pertaining to this issue. The probate court apparently set the undertaking at $90,000, as Riccardi made mention of this amount during a subsequent hearing.
Approximately one month later, on October 17, the probate court ruled on the fair market rental value of the property and set rent at $2,750 per month. Riccardi, however, claimed he owed no rent at all on a going forward basis because he had posted a $90,000 undertaking on appeal "to cover the amount of rent." Rejecting this assertion, the probate court stated the undertaking did not cover future rent, but instead covered "the period of time that he has lived in the residence without any funds passing to the trust." Accordingly, the court ordered Riccardi to pay rent, as of the date of the hearing, of $2,750 per month. Apparently, the probate court issued a written order on November 3 memorializing its rulings on the fair rental value of the property and Riccardi's obligation to pay rent to the trust. This is indicated by the register of actions, but the record on appeal also does not include a copy of this order.
DISCUSSION
Although, as the appellant, it is his burden to do so (Cal. Rules of Court, rule 8.204(a)(2)(B)), Riccardi has not adequately addressed the fundamental issue of appealability. The only ruling in the record on appeal is a copy of the probate court's September 22, 2016 written order granting Riccardi's motion for reconsideration but again refusing to abate the probate proceeding and confirming the OSC requiring him to vacate the property, and also ruling the trust is not ambiguous as to the disposition of the property. However, by that date, Riccardi had (on September 16) already filed a notice of appeal from the probate court's September 13 minute order, which is not in the record but is reflected in the court's register of actions. Thus, Riccardi's notice of appeal was premature. However, the appeal can be deemed to have been taken from the court's subsequent, written order. (See Eisenberg et al., Cal. Practice Guide: Civil Appeals and Writs (The Rutter Group 2017) ¶ 3:53, p. 3-27, citing Cal. Rules of Court, rule 8.104(d)(1); Marriage of Zimmerman (2010) 183 Cal.App.4th 900, 906 [notice of appeal filed after minute order but before entry of signed written order treated as filed immediately after entry of signed written order].)
More than a month later (on October 28), Riccardi filed an "amended" notice of appeal. This second notice of appeal purported to be from both the court's September 13 minute order and the court's October 17 minute order determining the fair market rental value of the property and requiring Riccardi to pay rent to the trust. To the extent this second notice of appeal purported to appeal from the court's September 13 minute order, it was inoperative, as Riccardi had already appealed from that order. To the extent this second notice of appeal is directed at the probate court's October 17 minute order, neither that minute order nor the court's subsequent written order filed November 3 is in the record on appeal. However, both are reflected in the register of actions. It thus appears that Riccardi's second notice of appeal as to the court's order on rent was also premature given that the court subsequently issued a written order. This appeal also can be deemed to have been taken from the later, written order.
Refusal to Abate the Probate Proceeding
Probate Code section 854 provides for mandatory abatement of a probate proceeding "[i]f a civil action is pending with respect to the subject matter of a petition filed pursuant to this chapter" and the civil action was not "filed for purpose of delay." (§ 854.) If the probate court determines the civil action was filed for purposes of delay, it "has discretion to deny the abatement request and proceed with the hearing on the § 850 petition." (Ross & Cohen, Cal. Practice Guide: Probate (The Rutter Group 2017) ¶ 15:610, p. 15-164.) " 'Discretion is abused whenever, in its exercise, the court exceeds the bounds of reason, all of the circumstances before it being considered.' " (Denham v. Superior Court (1970) 2 Cal.3d 557, 566.)
Ample evidence supports the probate court's finding that Riccardi filed the civil proceeding against Scardino to delay Scardino's efforts as trustee to marshal and dispose of trust property, and distribute trust assets. Riccardi and his family had been living on the property rent free since Morris's death. The mortgage was being paid out of a bank account that was to go solely to Jones, his sister. Both Scardino and Jones testified Riccardi refused to discuss a global settlement of the trust; rather, Riccardi was fixated on his claimed entitlement to purchase Jones's share of the San Bruno property at a date of death value (further depressed by the state of disrepair of the property). Ricarrdi refused to make a current fair market offer for Jones's half of the property, offering only $350,000, when the market value of the property with some repair was closer to $1 million or more.
While Riccardi insists he is not to blame for the delay in distributing trust assets and that no delay would have occurred had Jones accepted his $350,000 offer for her share of the equity in the property, it is Riccardi who is obdurately refusing to come to grips with reality. He resided on the property rent free for months, the mortgage has been and continues to be paid out of the account that is to go to his sister, and his purchase offer does not reflect the fair market value of the property, let alone take into account the contribution he owes for the dissipation of the bank account that is to go to Jones.
Given that the probate court did not abuse its discretion in refusing to abate the probate proceeding on the ground Riccardi filed the civil proceeding for purposes of delay, we need not and do not consider whether the two proceedings involved the same subject matter. --------
Interpretation of the Trust Disposition Provisions
As we have recited, Article IV, paragraph 3 of the trust states: "If my real property is to be sold, it shall be sold by Michael J. Scardino, realtor, and he shall be entitled to receive the normal fees paid to realtors for selling real property." (Boldface added.)
Riccardi claims the bolded language renders the trust disposition provisions ambiguous because it "raises a question as to what the Settl[o]r intended as to circumstances under which [the San Bruno Property] might not be sold." "Aided by the extrinsic evidence" that he claims the probate court should have considered, Riccardi contends "it can be understood that the circumstance under which the Property might not be 'sold' . . . was the very likely scenario, intended by the Settlor, in which Riccardi would be willing and able to pay the fair market value of Jones' one-half share of the Property's equity."
" '[T]he primary rule in construction of trusts is that the court must, if possible, ascertain and effectuate the intention of the trustor or settlor.' [Citation.] 'The intention of the transferor as expressed in the [trust] instrument controls the legal effect of the dispositions made in the instrument.' (Prob. Code, §§ 21101, 21102.)" (Crook v. Contreras (2002) 95 Cal.App.4th 1194, 1206.) " ' " 'The interpretation of a written instrument, including a . . . declaration of trust, presents a question of law. . . . Accordingly, a reviewing court is not bound by the lower court's interpretation but must independently construe the instrument at issue.' " ' " (Ike v. Doolittle (1998) 61 Cal.App.4th 51, 73.) Whether the instrument is ambiguous is also a question of law, and an appellate court independently reviews the instrument to determine whether ambiguity exists. (See Colonial Ins. Co. v. Montoya (1986) 184 Cal.App.3d 74, 82.)
As the trial court stated, this "could not be a simpler trust." It is clear that Morris's intention was that her children, Riccardi and Jones, share equally in most of the assets, including the San Bruno property. This is shown by paragraph 2, of Article IV of the trust, which states "All the rest of my property shall be given equally to Lisa Jones and Kenneth J. Riccardi, share and share alike." (Italics added.) To ensure this distribution, paragraph 4 specifically authorizes Scardino to sell the real property. In short, on its face, the trust language is unambiguous.
However, "California law allows the admission of extrinsic evidence to establish that a will [or trust] is ambiguous and to clarify ambiguities in a will." (Estate of Duke (2015) 61 Cal.4th 871, 879 (Duke).) We therefore turn to the extrinsic evidence Riccardi maintains gives rise to ambiguity.
Riccardi points to the following: (1) The text message from Jones that Morris "told Uncle Mile [sic] verbally that she wants you [Riccardi] to have first choice in buying house." (2) Scardino's declaration that, "My sister never told me that [Riccardi] was to have her house. She told me that it was for both of her children equally and that if her son wanted to buy out her daughter's interest, she would have no objection." (3) A statement by Scardino's attorney at the September 13 hearing that, "Both Mr. Scardino and Ms. Jones have indicated that Ms. Morris would have had no objection if Ken was to buy out Lisa's interests, and we said that all along, it is a question of the price." (4) A statement by Jones's attorney at that same hearing that, "My client would testify that in discussions with her mother she was more than willing to let her brother buy out the house, if it was done at fair market value." (5) Riccardi's declaration that Morris told him "she had instructed her brother ([] Scardino), that I should be allowed to buy the Property, where I had lived nearly all my life, by simply paying my sister half its value." (6) A declaration from Riccardi's daughter that, "I heard my grandmother Carol Morris say many times in my presence and also in the presence of my father Kenneth J. Riccardi that she wanted my father to be able to remain living in 120 Daley Court after she passed away and that she wanted my father to buy out his sister Lisa Jones' interest in the Property. I never heard her say that my father would first have to vacate the house and have it listed for sale to the public. Rather, she indicated he was to simply just pay my Aunt Lisa half the value of the house and thereby become its sole owner." And (7), a declaration from Riccardi's therapist where he declared that "During my treatment of Mr. Riccardi in 2012-2013, he did discuss with me that he had in the past contributed to his mother's payment of the mortgage on the home, and that he expected his mother to provide him an opportunity to buy out his sister's interest so that he could continue living there after she passed away."
Even putting aside any evidentiary issues with these statements, they do not, as the probate court ruled, give rise to any ambiguity as to the dispositional provisions of the trust. While they may reflect a desire and hope on Morris's part that Riccardi would be able to buy out his sister's share of the property, they do not support Riccardi's claim that he has an absolute right to buy out her share valued as of the date of death and to do so, moreover, without regard to the fact he lived on the property for months rent free and that the mortgage and taxes have been paid from an account that, pursuant to other provisions of the trust, is to be distributed solely to Jones. Riccardi is simply in error in assuming he does not have to pay current fair market value for Jones's share of the real estate and that he is entitled to buy out his sister's share valued as the date of Morris's death. The property is owned by the trust, and the trustee would breach his fiduciary duties if he disposed of it, in whole or in part, without maximizing the return to the trust. (See Toedter v. Bradshaw (1958) 164 Cal.App.2d 200, 208 [trustee always has a duty to consider and act in the best interests of the trust]; Cal. Trust Administration (Cont.Ed.Bar 2d ed. 2018) § 6.19, p. 6-15 ["The goal of any method [of sale of real property] is to expose the property to as many potential buyers as possible and to obtain the best financial transaction for the benefit of the trust and the beneficiaries."].) Had Morris desired or intended otherwise, she could have so provided in the trust, but she did not.
Riccardi alternatively contends the probate court should have permitted reformation of the trust because he purportedly met the standard articulated in Duke, supra, 61 Cal.4th 871. Riccardi never advanced this claim in the probate court. Accordingly, he has forfeited it on appeal. (See Johnson v. Greenelsh (2009) 47 Cal.4th 598, 603 [party may not, for the first on appeal, raise new issues not raised in the trial court]; In re Estate of Westerman (1968) 68 Cal.2d 267, 278-279 [same].)
In any case, Riccardi's belated assertion is meritless. Duke involved a decedent's holographic will, which contained provisions in the event he predeceased his wife or if he and his wife died at the same time, but "contained no provision addressing the disposition of his estate if . . . he lived longer than his wife." (Duke, supra, 61 Cal.4th at p. 875.) The probate court and the Court of Appeal excluded extrinsic evidence that the decedent intended to provide for certain charities in the event his wife predeceased him, finding the will unambiguous. (Ibid.) The courts therefore concluded Duke died intestate and entered judgment in favor of his heirs at law. The Supreme Court reversed, stating "an unambiguous will may be reformed if clear and convincing evidence establishes that the will contains a mistake in the expression of the testator's intent at the time the will was drafted and also establishes the testator's actual specific intent at the time the will was drafted." (Ibid.)
Again, none of the evidence establishes, let alone by clear and convincing evidence, that Morris intended that Riccardi have an absolute right to buy out Jones's share as of the date of Morris's death, as well as without regard to the fact rent should have been paid to the trust following Morris's death and without regard to the fact the mortgage and taxes have been paid from a bank account that, pursuant to other provisions of the trust, is to be distributed solely to Jones.
Payment of Rent
Riccardi also claims the probate court erred in requiring him, as of October 17, 2016, to commence paying $2,750 a month in rent to the trust. He does not challenge the amount of the rent. Rather, he claims he should not have to pay any rent at all because he posted a $90,000 undertaking, which, according to Riccardi, "was specifically to cover rent and wastage during the pendency of the appeal."
Code of Civil Procedure section 917.4 provides: "The perfecting of an appeal shall not stay enforcement of the judgment or order in the trial court if the judgment or order appealed from directs the sale, conveyance or delivery of possession of real property which is in the possession or control of the appellant or the party ordered to sell, convey or deliver possession of the property, unless an undertaking in a sum fixed by the trial court is given that the appellant or party ordered to sell, convey or deliver possession of the property will not commit or suffer to be committed any waste thereon and that if the judgment or order appealed from is affirmed, or the appeal is withdrawn or dismissed, the appellant shall pay the damage suffered by the waste and the value of the use and occupancy of the property, or the part of it as to which the judgment or order is affirmed, from the time of the taking of the appeal until the delivery of the possession of the property. If the judgment or order directs the sale of mortgaged real property and the payment of any deficiency, the undertaking shall also provide for the payment of any deficiency." (Code Civ. Proc., § 917.4, italics added.)
As we have stated, the record on appeal contains none of the documents pertaining to the probate court's setting of the undertaking. As far as we can discern from the register of actions, the parties briefed the issue and the trial court ruled on the matter of the undertaking on or about September 21. We do not know what statements or representations were made when the probate court set the amount of the undertaking. Nor do we have any clue as to the court's reasoning, at the time, in setting the amount. All we know from the record on appeal is that the court set the undertaking at $90,000.
The only notice of appeal that Riccardi had filed as of September 21 when the probate court fixed the amount of the undertaking, was his notice of appeal (filed on September 16) from the probate court's September 13 minute order (a) granting his motion for reconsideration of the probate court's July 22 written order refusing to abate the probate proceeding and issuing an OSC ordering him to vacate the property, but on reconsideration, reaching the same conclusions, and (b) ruling the trust dispositional provisions were not ambiguous. Accordingly, the undertaking pertained to that appeal and secured a stay of that court order.
It was not until a month later, on October 17, that the probate court addressed the issue of the fair market rental value of the property and ordered Riccardi to pay rent. During the hearing, Riccardi claimed he owed no rent at all on a going forward basis because he had posted the $90,000 undertaking, which he claimed was "to cover the amount of rent." The probate court disagreed, stating the undertaking covered only "the period of time that he has lived in the residence without any funds passing to the trust" and thus ordered Riccardi to pay, from that point, $2,750 per month in rent.
On appeal, Riccardi continues to insist that having posted the $90,000 undertaking in connection with his first appeal, he could not thereafter be ordered to pay rent. The fundamental problem with his assertion is that the $90,000 undertaking stayed a prior order from which Riccardi had already appealed. Specifically, the $90,000 undertaking secured a stay of the probate court's September 13 minute order (memorialized in a written order filed September 22) granting reconsideration but again refusing to abate the probate proceeding and confirming the OSC requiring Riccardi to vacate the property, and also rejecting Riccardi's assertion that the trust is ambiguous and he is entitled to buy out his sister's share of the property for $350,000. In short, by posting the $90,000 undertaking, Riccardi obtained a stay of the OSC requiring him to vacate the property.
The $90,000 undertaking ordered and posted in connection with Riccardi's first appeal had no bearing whatsoever on the probate court's subsequent order on rent issued a month later, on October 17 (and memorialized in a written order filed November 3). The $90,000 undertaking also did not effect a stay of the court's rent order in connection with Riccardi's appeal from that, later order. Whether Riccardi's second notice of appeal (filed on October 28) automatically stayed the probate court's order on rent, or whether Riccardi must post another undertaking to obtain a stay of that order, is not an issue either party has raised on appeal and, thus, is not an issue we need to, or do, decide.
DISPOSITION
The orders of the Probate Court are affirmed.
/s/_________
Banke, J. We concur: /s/_________
Humes, P.J. /s/_________
Margulies, J.