Estate of Jones

Filed 9/2/22 CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION THREE

Estate of CHARLES A. JONES, Deceased.

HELEN GRAYS-JONES, Petitioner and Appellant, A162543 v. (San Mateo County SANDRA SPENCER, as Trustee, etc., Super. Ct. No. 17PRO01298) Objector and Respondent.

Upon the death of Charles A. Jones (decedent), his daughter, Sandra Spencer, became successor trustee of his trust. His third wife, Helen Grays- Jones, was not included in the trust. Unsurprisingly, this litigation ensued. The parties settled, agreeing the trust would pay Grays-Jones $3 million. But the settlement agreement also provided the money would be paid “out of the escrow from the sale” of specified real property (property). Sale of the property — pending at the time the parties reached their agreement — fell through. Escrow never closed, and Spencer, as trustee, never paid the $3 million. Did the collapse of the sale void Spencer’s promise to pay? The answer is no. We conclude the settlement agreement contained a condition precedent as to the method of payment, but Spencer’s independent promise to pay $3 million is enforceable and remains payable upon the property’s sale. We reverse and remand.

1

BACKGROUND In 1999, decedent established, and later restated, the Charles A. Jones Trust (trust) and named Spencer successor trustee. The property — where decedent had operated a mortuary — was the trust’s principal asset. In 2006, decedent married Grays-Jones, but he did not amend the trust to include her. In 2017, decedent entered into an agreement to sell the property to Calvano Development, Inc. (CDI), a real estate developer, for $13.6 million. The decedent died shortly thereafter, while the property was in escrow. Spencer became successor trustee. A few months later, Grays-Jones petitioned for an interest in decedent’s estate as an omitted spouse (Prob. Code, § 21610). In 2019 — and while the property was still in escrow — Grays-Jones and Spencer, as trustee, reached a settlement. They agreed the trust “shall pay to [Grays-Jones] a total of $3,000,000 . . . as her full and final settlement of [Grays-Jones’s] interest in the Estate. Payment of said amount shall be paid to [Grays-Jones] out of the escrow from the sale of the [property].” The parties also agreed Grays-Jones would move out of decedent’s residence in exchange for $150,000, which would constitute “an advance against the total settlement amount.” Shortly thereafter, the trial court entered a stipulated judgment incorporating the settlement, and the parties initially complied with their obligations. That is, Spencer, as trustee, paid Grays-Jones a $150,000 advance on the $3 million, and Grays-Jones moved out of decedent’s residence. But three months after judgment was entered, the sale of the property fell through, and Spencer did not pay Grays-Jones the outstanding $2.85 million. In 2020, Grays-Jones petitioned the trial court to enforce the stipulated judgment. (Code Civ. Proc., § 664.6.) Grays-Jones alleged Spencer frustrated