DETERMINING QUESTIONS OF CONSTRUCTIONS OF TRUST INSTRUMENT
August 3, 2026 Dept. 9 Probate Tentative Rulings
10. 26PR0185 IN THE MATTER OF OATMAN FAMILY TRUST DATED JULY 23, 1996 DETERMINING QUESTIONS OF CONSTRUCTIONS OF TRUST INSTRUMENT
On June 22, 2026, Petitioner, Mark Oatman (“Petitioner” or “Trustee”), filed a Petition Under Cal. Prob. Code § 17200 for Orders Determining Questions of Construction of Trust Instrument, Determining Validity of Trust Amendments, Ascertaining Beneficiaries, and Passing Upon the Acts of the Trustee. A Notice of Hearing was filed on June 24, 2026. No opposition has been filed.
Background: Floyd W. Oatman and Jeanette M. Oatman (collectively “Settlors”) established the Oatman Family Trust (the “Trust”) on July 23, 1996. On September 25, 2003, the Settlors executed a handwritten document entitled “Codicil to the Oatman Family Trust of July 23, 1996.” The document states: On page 4 of the Trust strike everything beginning with “(i) if Floyd is the deceased spouse” to the bottom of page 4. In other words remove from the Trust all of 6(i), 6(ii) and 6(iii).
On September 26, 2003, the Settlors executed two handwritten documents, each entitled “Codicil to the Oatman Family Trust,” consisting of two separate pages. The first document states: Page 9 last paragraph 9(i) strike the words “or in more frequent intervals.” The third document provides: Page 10 following the words “principal and accrued income” in the second line add the following “of the 10% give one quarter of one percent to each of the following: St. Paul’s Lutheran Church 5588 E Co Road 9005 Cross Plains Indiana 47017-9707; Grace Lutheran Church 2825 Alameda, San Mateo CA 94403-3299; Ministerial Training Fund California Nevada Hawaii District Livermore, CA; St John’s Lutheran Church 7291 State Road 62 Dillsboro Indiana 47018-9738.”
Upon the death of Surviving Settlor, the Settlors had four living children: Mark Oatman, Theresa Oatman, Bruce Oatman, and Dean Oatman. They had no deceased children survived by issue. On August 9, 2025, Bruce Oatman died, leaving behind four living children: Michael Oatman, Sarah Oatman, Jonathan Oatman, and Rachael Mortensen. Bruce Oatman had no deceased children survived by issue. //
August 3, 2026 Dept. 9 Probate Tentative Rulings
Legal Principles: Probate Code § 17200
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Discussion: 1. Validity of Handwritten Amendments Petitioner argues that the Settlors intended to amend the Trust by way of the three handwritten documents created on September 25, 2003, and September 26, 2003. Petitioner requests a court order determining that each of these amendments is a valid amendment to the Trust.
Probate Code § 15401(a) allows for a trust that is revocable by the settlor or any other person may be revoked in whole or in part by compliance with any method of revocation provided in the trust instrument or by writing, other than a will, signed by the settlor or any other person holding the power of revocation and delivered to the trustee during the lifetime of the settlor or person holding the power of revocation. If the trust instrument explicitly makes the method of revocation provided in the trust instrument the exclusive method of revocation, the trust may not be revoked pursuant to this paragraph.
Paragraph 23(b) of the Trust provides, in part: 23. Revocation and Amendment. (b) We may at any time during our joint lifetimes amend any of the terms of this trust agreement by an instrument in writing signed by both of us and delivered to trustee... Each of the three handwritten documents were prepared during the Settlors’ lifetimes and were signed by each Settlor in compliance with the Trust’s procedures. The Court finds that the three handwritten documents are valid Trust amendments. The Court orders the Trust instrument shall be amended consistent with the handwritten documents and read, in part, as follows:
August 3, 2026 Dept. 9 Probate Tentative Rulings
6. Administration Upon First Death. (a) The First Settlor to die shall be called the deceased spouse, and the living spouse shall be called the surviving spouse. ...
14. Continuing Trust for Beneficiaries. (a) The Beneficiaries of the Continuing Trust shall be the Settlors’ children, but if any of said children shall fail to survive, then said child’s children shall be beneficiaries of that child’s share, by right of representation. If a Settlor’s child leaves no surviving children, then said child’s surviving spouse shall be the beneficiary of that child’s share. (b) The rest, residue and remainder of the trust estate shall be administered for the benefit of the beneficiaries in the following manner: (i) The Trustees may distribute, annually, a sum not to exceed ten percent (10%) of the then present value of the trust, which shall include principal and accrued income.
Of the 10% give one quarter of one percent to each of the following: St. Paul’s Lutheran Church 5588 E Co Road 9005 Cross Plains Indiana 47017-9707; Grace Lutheran Church 2825 Alameda, San Mateo CA 94403-3299; Ministerial Training Fund California Nevada Hawaii District Livermore, CA; St John’s Lutheran Church 7291 State Road 62 Dillsboro Indiana 47018-9738. Any income not so distributed shall be added to the trust principal. The trustee’s election to distribute principal must be made in the current year.
The trustees shall not be allowed to cumulate undistributed amounts of principal from a previous year or years. ...
2. Determining Questions of Construction Petitioner argues the modification to section 14 of the Trust permits the Trustee to distribute a total sum of up to ten percent (10%) of the then present value of the trust, including principal and accrued income, on an annual basis as follows: up to nine percent (9%) of the then present value of the Trust to the Settlors’ children, equally, and up to one percent (1%) of the then present value of the Trust, split equally among St. Paul’s Lutheran Church, Grace Lutheran Church, St. John’s Lutheran Church, and Ministerial Training Fund California Nevada Hawaii District. Petitioner requests an order confirming this construction regarding the timing and amount of distributions from the Trust. Pursuant to Probate Code § 17200(b)(1), the Court confirms this construction regarding the timing and amount of distributions from the Trust. // 13
August 3, 2026 Dept. 9 Probate Tentative Rulings
3. Ascertaining Beneficiaries of Trust Petitioner requests an order determining that the beneficiaries of the Continuing Trust shall be the children of the Settlors, equally, and that, upon the death of a child, the deceased child’s share shall pass to the deceased child’s children by right of representation until such time as no issue of the Settlors remain, when the remaining trust estate shall be distributed to the Ministerial Training Endowment Fund. Bruce Oatman, one of the children of the Settlors, survived the Settlors but later died on August 9, 2025. Petitioner requests a court order ascertaining the present beneficiaries of the Continuing Trust.
Paragraph 14(a) of the Trust provides: The Beneficiaries of the Continuing Trust shall be the Settlors’ children, but if any of said children shall fail to survive, then said child’s children shall be beneficiaries of that child’s share, by right of representation. Paragraph 13(d) provides: Except as otherwise specifically provided in this trust agreement, if any person named herein fails to survive the surviving spouse for thirty (30) days, for all purposes of this trust agreement, the person shall have been considered to have predeceased the surviving spouse. There is no provision that states what happens to a child’s share when a child survives the Settlors but later dies during administration of the Continuing Trust.
Petitioner is informed and believes that the Settlors intended to benefit future generations of their family with the ongoing Continuing Trust established under Paragraph 14 of the Trust. Petitioner understood from conversations with his parents that they desired that distributions be made to their grandchildren in the case where a child died during administration of the Continuing Trust for Beneficiaries. Petitioner further argues this intent is evident in other language within the Trust, such as Paragraph 14(b)(ii), which provides: This trust shall continue until all of the beneficiaries of the Continuing Trust shall have deceased, or as hereinafter provided in Paragraph 20, at which time the remaining balance of the trust estate shall be distributed to the Ministerial Training Endowment Fund of the California-Nevada- Hawaii District of the Lutheran Church-Missouri Synod, or to its successor in interest.
Paragraph 20 of the Trust provides: Perpetuity Provision. Unless terminated earlier in accordance with provisions of this instrument, all trusts created under this trust agreement shall terminate twenty-one (21) years after the death of the last survivor
August 3, 2026 Dept. 9 Probate Tentative Rulings
of our issue living on the date of the death of the first Settlor to die. The principal and undistributed income of a terminated trust shall be distributed to the income beneficiaries of the trust in the same proportion that the beneficiaries are entitled to receive income when the trust terminates. If at the time of termination the rights to income are not fixed by the terms of the trust, distribution under this clause shall be made, by right of representation, to the persons who are then entitled or authorized, in the trustee’s discretion, to receive trust payments.
Probate Code § 21102 instructs that: (a) The intention of the transferor as expressed in the instrument controls the legal effect of the dispositions made in the instrument. (b) The rules of construction in this part apply where the intention of the transferor is not indicated by the instrument. (c) Nothing in this section limits the use of extrinsic evidence, to the extent otherwise authorized by law, to determine the intention of the transferor. All parts of an instrument are to be construed in relation to each other and so as, if possible, to form a consistent whole. If the meaning of any part of an instrument is ambiguous or doubtful, it may be explained by any reference to or recital of that part in another part of the instrument. Probate Code § 21121.
Considering the Trust as a whole, the Court finds that the Settlors intended each child’s share to pass to said child’s children by right of representation when the child dies during the administration of the Continuing Trust. The Court grants Petitioner’s request and orders that the beneficiaries of the Continuing Trust shall be the children of the Settlors, equally, and that, upon the death of a child, the deceased child’s share shall pass to the deceased child’s children by right of representation until such time as no issue of the Settlors remain, when the remaining trust estate shall be distributed to the Ministerial Training Endowment Fund.
Petitioner further wishes to clarify the distribution of any of the named charitable organization’s shares should that organization cease to exist, which is not provided under the terms of the amendment. Petitioner is informed and believes that the Trustee may make annual discretionary distributions of up to one percent (1%) to charitable organizations supporting their religious beliefs. Petitioner contends Settlors intended that should one of the named charitable organizations cease to exist, the remaining named organizations should share equally in the one percent (1%) available for distribution to charitable organizations. Petitioner requests an order determining that the specified named charitable organizations, or the survivor(s) of them, shall receive up to one percent (1%) of the discretionary distributions from the Continuing Trust. // //
August 3, 2026 Dept. 9 Probate Tentative Rulings
Paragraph 14(b)(i) and (ii) instructs: 14. Continuing Trust for Beneficiaries. (b) The rest, residue and remainder of the trust estate shall be administered for the benefit of the beneficiaries in the following manner: (i) The Trustees may distribute, annually, a sum not to exceed ten percent (10%) of the then present value of the trust, which shall include principal and accrued income. Of the 10% give one quarter of one percent to each of the following: St. Paul’s Lutheran Church 5588 E Co Road 9005 Cross Plains Indiana 47017-9707; Grace Lutheran Church 2825 Alameda, San Mateo CA 94403-3299; Ministerial Training Fund California Nevada Hawaii District Livermore, CA; St John’s Lutheran Church 7291 State Road 62 Dillsboro Indiana 47018-9738.
Any income not so distributed shall be added to the trust principal. The trustee’s election to distribute principal must be made in the current year. The trustees shall not be allowed to cumulate undistributed amounts of principal from a previous year or years. (ii) This trust shall continue until all of the beneficiaries of the Continuing Trust shall have deceased, or as hereinafter provided in Paragraph 20, at which time the remaining balance of the trust estate shall be distributed to the Ministerial Training Endowment Fund of the California-Nevada-Hawaii District of the Lutheran Church-Missouri Synod, or to its successor in interest.
It is generally held that a gift to a charitable or religious nonprofit corporation is deemed to have been made in trust “to carry out the objects for which the organization was created.” (Lynch v. Spilman (1967)67 Cal.2d 251, 260, 62 Cal.Rptr. 12, 18, 431 P.2d 636, 642; Estate of Fitzgerald (1923) 62 Cal.App. 744, 750, 217 P. 773.) No technical words or further manifestations of general charitable intent are necessary in order to create such a trust. (Estate of Connolly (1975) 48 Cal.App.3d 129, 133, 121 Cal.Rptr. 325; see also: Samoan Congregational etc. Church in U. S. v. Samoan Congregational etc. Church of Oceanside (1977) 66 Cal.App.3d 69, 73-74, 135 Cal.Rptr. 793; Rest.2d Trusts (1959), s 397, com. f., p. 287; 4 Scott, Trusts (3d ed. 1967) s 351, pp. 2797-2798.) Estate of Klinkner (1978) 85 Cal.App.3d 942, 946 [151 Cal.Rptr. 20, 22–23].
“(C)y pres is an equitable power which makes it possible for a court to carry out a testamentary trust established for a particular charitable purpose if the testator has expressed a general charitable intent, and for some reason his purpose cannot be accomplished in the manner specified in the will (citation); the court, to meet unexpected contingencies, directs the disposition of the property to some related charitable purpose in order to carry out the testator's intention as nearly as possible (citation).” (Estate of Gatlin (1971) 16 Cal.App.3d 644, 648, 94 Cal.Rptr. 295, 296-297. Footnote omitted.) Id. at 951. 16
August 3, 2026 Dept. 9 Probate Tentative Rulings
In determining whether there has been expressed a general charitable intent, the trust instrument is always construed most strongly against the trustor, for the reason that the courts favor charities. Once it has been determined that the creator of the trust had a general charitable purpose, the courts will presume that the creator of the trust did not desire the trust to fail.’ O'Hara v. Grand Lodge I. O. G. T., 213 Cal. 131, 141, 2 P.2d 21, 25. It is ‘the general rule that in case of doubt a gift must be interpreted in favor of a charity [citations] * * *.’ In re Estate of Loring, 29 Cal.2d 423, 435, 175 P.2d 524, 531. In re Faulkner's Estate (1954) 128 Cal.App.2d 575, 578–579 [275 P.2d 818, 821].
Probate Code § 15409 allows for the court to modify the administrative or dispositive provisions of the trust, 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. In this case, if necessary to carry out the purposes of the trust, the court may order the trustee to do acts that are not authorized or are forbidden by the trust instrument.
Considering the Trust as a whole, the Court finds that the Settlors expressed a general charitable intent, as evidenced by paragraph 14(b)(i) and 14(b)(ii), which bequeathed trust assets to various Lutheran churches. Should one of the churches in paragraph 14(b)(i) cease to exist, their partition of the 1% would lapse into trust principal. The Court does not find that this would further the intent of the Settlors. Should one of the specified named charitable organizations in paragraph 14(b)(i) cease to exist, the remaining charitable organizations or their survivors (so long as they carry out the same related charitable purpose) shall receive shares equally in the one percent (1%) of the discretionary distributions from the Continuing Trust.
4. Passing Upon Acts of Trustee Petitioner, as Trustee, made a discretionary distribution to beneficiary, Bruce Oatman, just prior to his death on August 9, 2025. Following Bruce’s death on December 19, 2025, Petitioner made a second discretionary distribution to Rebecca Oatman, Bruce’s surviving spouse, in the amount of $24,750 which represented Bruce’s share of the discretionary distributions made by the Trustee in 2025 and did not exceed the amount permitted to be distributed to Bruce pursuant to the Trust terms. Petitioner requests an order passing on his discretionary distribution of Bruce’s share to his surviving spouse.
As this Court has ruled, Bruce Oatman’s share of the discretionary funds of the Continuing Trust passes to his children by representation consistent with the Settlor’s intent. By distributing Bruce’s share to his surviving spouse, Trustee has made an unauthorized distribution. Petitioner’s request for an order passing on his discretionary distribution of Bruce’s share to his surviving spouse is denied.
TENTATIVE RULING #10: ABSENT OBJECTION PETITIONER’S REQUESTS FOR THE FOLLOWING ARE GRANTED:
August 3, 2026 Dept. 9 Probate Tentative Rulings
1. THE THREE HANDWRITTEN DOCUMENTS ARE VALID TRUST AMENDMENTS.
2. TRUSTEE SHALL DISTRIBUTE A TOTAL SUM OF UP TO TEN PERCENT (10%) OF THE THEN PRESENT VALUE OF THE TRUST, INCLUDING PRINCIPAL AND ACCRUED INCOME, ON AN ANNUAL BASIS AS FOLLOWS: UP TO NINE PERCENT (9%) OF THE THEN PRESENT VALUE OF THE TRUST TO THE SETTLORS’ CHILDREN, EQUALLY, AND UP TO ONE PERCENT (1%) OF THE THEN PRESENT VALUE OF THE TRUST, SPLIT EQUALLY AMONG ST. PAUL’S LUTHERAN CHURCH, GRACE LUTHERAN CHURCH, ST. JOHN’S LUTHERAN CHURCH, AND MINISTERIAL TRAINING FUND CALIFORNIA NEVADA HAWAII DISTRICT.
3. THE BENEFICIARIES OF THE CONTINUING TRUST SHALL BE THE CHILDREN OF THE SETTLORS, EQUALLY, AND THAT UPON THE DEATH OF A CHILD, THE DECEASED CHILD’S SHARE SHALL PASS TO THE DECEASED CHILD’S CHILDREN BY RIGHT OF REPRESENTATION UNTIL SUCH TIME AS NO ISSUE OF THE SETTLORS REMAIN, WHEN THE REMAINING TRUST ESTATE SHALL BE DISTRIBUTED TO THE MINISTERIAL TRAINING ENDOWMENT FUND.
4. SHOULD ONE OF THE SPECIFIED NAMED CHARITABLE ORGANIZATIONS IN PARAGRAPH 14(B)(I) CEASE TO EXIST, THE REMAINING CHARITABLE ORGANIZATIONS OR THEIR SURVIVORS (SO LONG AS THEY CARRY OUT THE SAME RELATED CHARITABLE PURPOSE) SHALL RECEIVE SHARES EQUALLY IN THE ONE PERCENT (1%) OF THE DISCRETIONARY DISTRIBUTIONS FROM THE CONTINUING TRUST.
PETITIONER’S REQUEST FOR AN ORDER PASSING ON HIS DISCRETIONARY DISTRIBUTION OF BRUCE OATMAN’S SHARE TO HIS SURVIVING SPOUSE IS DENIED. ANY PERSON WHO HAS AN OBJECTION MAY MAKE IT ANY TIME, EVEN ORALLY AT THE HEARING (PROBATE CODE § 1043). IF A PARTY OR PARTIES WISH TO APPEAR BY ZOOM, PLEASE CONTACT THE COURT AT (530) 621-5867 AND MEETING INFORMATION WILL BE PROVIDED.
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