Farmers and Merchants Trust v. Kennedy CA2/6

Filed 2/1/22 Farmers and Merchants Trust v. Kennedy CA2/6 NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for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). Thi s opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION SIX

FARMERS AND MERCHANTS 2d Civ. No. B311559 TRUST COMPANY, as (Super. Ct. No. 20PR00409) Successor Trustee, etc., (Santa Barbara County)

Plaintiff,

v.

SHARON KENNEDY, as Conservator, etc.,

Objector and Respondent;

ANNE PAULEY,

Real Party in Interest and Appellant.

An alleged trustee of a testamentary trust petitioned the probate court for instructions allowing it to recover funds distributed by a predecessor trustee. The trial court denied the

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petition. We affirm but not for the reasons set forth by respondent. FACTS The Isabel Geis Testamentary Trust (hereafter Trust) was established in 1972. Isabel had a daughter, Victoria. Victoria was married to and divorced from Edwin Pauley. Victoria and Edwin had three children, J., Anne, and E. J. and E. suffer from developmental disabilities.1 Victoria was a beneficiary of the Trust while she lived. She is now deceased. J. has a separate trust. Anne and E. are beneficiaries of separate subtrusts created under the Trust. This litigation involves E.’s subtrust. The income from the subtrusts is paid to Anne and E. during their lives. If Anne or E. die without issue, the deceased sister’s share will be held in trust for the benefit of the surviving sister. If both sisters die without issue, the remaining corpus will be paid to named charities free of the Trust. The original trustee was the Bank of California. By virtue of a merger, Union Bank succeeded as trustee. The Trust provides that when Anne or E. attain 35 years of age, they may, by written demand to the trustee, require the distribution of one-third of their entire share. At the time E. attained 35 years of age, she was under a conservatorship. Sharon Kennedy is the conservator of E.’s estate. In 2019, after E. had attained the age of 35, Kennedy made demand on Union Bank for a distribution of one-third of E.’s trust share. Union Bank distributed $914,378.25 to Kennedy