Navigating probate matters can feel like an uphill battle, and the uncertainty around outcomes only adds to the challenge. But by aligning yourself with a reputable law firm focused on probate law, you may be able to tilt the odds in your favor.
At Keystone Law Group, our attorneys practice exclusively in the areas of probate litigation and administration. As a result of their narrow focus, they are highly specialized and have a remarkable track record of finding creative resolutions to even the most complex probate issues. To gain insight into the types of favorable outcomes we’ve managed to secure for our clients, we hope you’ll take a few minutes to review our most notable triumphs from 2023.
Though our victories may resonate with your legal concerns, it’s important to remember that each case is unique, and that our past successes don’t guarantee future results. If you have a specific probate matter, we encourage you to request a free consultation with one of our probate attorneys.
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Double Damages Awarded: A Trust Misappropriation Victory
Our client came to us with a dilemma: Despite the substantial wealth her mother and stepfather had accumulated during their lifetimes, their joint trust appeared to be virtually unfunded following her stepfather’s death. She realized that the money had gone into a new trust that had been created by her stepfather and that provided for only his children.
Our client’s mother and stepfather had gotten married in their senior years, each already having their own set of adult children. After over a dozen years of marriage, the two created a joint trust to hold their assets. This joint trust held title to all the real property and stock owned by the couple. Our client, along with all the other children of her mother and stepfather, were named equal trust beneficiaries of the joint trust.
After many years of marriage, a dispute arose between our client’s sister and the stepfather about how to best care for the mother in her elderly years, as she was experiencing a cognitive decline. A divorce proceeding was filed, but several years later, it was dismissed.
After the divorce was dismissed and the mother and stepfather reunited, the latter created a new trust. He transferred almost all the assets from the couple’s joint trust into this new trust and named only his three children as beneficiaries, not any of the mother’s children. His actions may have gone unnoticed by the mother, because around the time he did this, she had been experiencing a sharp decline in cognition. A few years later, the mother died, but it wasn’t until the stepfather died that our client discovered what had transpired with her mother and stepfather’s joint trust.
Our attorneys investigated the assets of the stepfather’s trust, issuing subpoenas to numerous banks and obtaining records from the divorce proceeding to determine whether the assets of the couple’s joint trust had been wrongfully taken by the stepfather. The stepfather had been an active stock trader, which meant that many stocks had been sold, with the proceeds from the sales having been used to purchase new stock. This made this process all the more complex.
After careful and thorough examination of these records, Keystone determined that the assets comprising the stepfather’s trust had originally been accumulated during the marriage of the mother and stepfather, and they had been derived from assets held in the couple’s joint trust. This determination was critical, as the couple had created an agreement (known as a transmutation agreement) as part of their joint trust that all assets held in their joint trust would be considered community property unless they were otherwise specified to be separate property.
The trustee of the stepfather’s trust, our client’s stepsister, did not agree to resolve the case when confronted with these facts. She instead argued that the assets of her father’s trust must have been his separate property, either due to the divorce proceedings or based on a separate property agreement created alongside her father and stepmother’s joint trust.
The case went to trial. Keystone’s attorneys called several witnesses, including a forensic accountant, our client, the trustee of the stepfather’s trust, and another daughter of the stepfather to establish that the assets of the stepfather’s trust had been improperly taken by the stepfather at a time when the couple had still been married and the mother lacked capacity.
The forensic accountant testified to the treatment of the assets at the time of the marriage and to the fact that nearly all the assets had been acquired during the marriage — a critical determination for establishing that the assets had been community property. He also testified that the separate property agreement created alongside the couple’s joint trust did not provide a sufficient basis for tracing separate property.
In our closing trial brief, Keystone provided a legal analysis showing that the stepfather could not have created separate property during the divorce proceeding, as the divorce had been dismissed and the marriage had continued. We also argued that the stepfather acted in bad faith when he transferred assets from the trust he’d shared with his wife to his own trust. Under California Probate Code section 859, double damages are available against parties who act in bad faith and wrongfully take property from a trust.
The court agreed with Keystone’s analysis, finding that our client’s stepfather had wrongfully, and in bad faith, taken assets from the joint trust he’d created with his wife. It not only ordered the return of the assets from his trust to the couple’s joint trust, but it also, due to his bad faith conduct, awarded double damages. This meant that the court ordered for all the assets of the stepfather’s trust, rather than just the mother’s one-half share, to be transferred back to the couple’s joint trust.
Keystone’s extensive and careful preparation for trial helped the court reach the correct result, as justice prevailed for our client.
Proximity to Death Does Not Invalidate a Trust
In this trust dispute case, Keystone successfully proved that one’s proximity to death has little bearing on their capacity to create a trust.
We represented a client who was successor trustee of her mother’s trust and the sole beneficiary of the mother’s residence. The trust — which was prepared approximately one month prior to the mother’s death — entirely disinherited a second daughter and left only a small gift to a third.
Within two months of the mother’s death, the disinherited daughter brought a trust contest to try to have her mother’s trust invalidated. She was arguing that our client had exerted undue influence on the decedent to create the trust at a time when she lacked the necessary capacity, due to illness, to understand the trust’s provisions or the potential consequences of creating the trust.
Approximately two years later, the third daughter, who had a small interest in the trust, brought a second petition alleging that our client had breached her fiduciary duties as trustee. She, consequently was requesting for the court to have our client removed as trustee and surcharged for any damage her supposed breaches caused to the trust.
Despite the parties attempting to informally resolve the petitions at settlement conferences on two separate occasions, the petitions went to trial in 2023.
After the completion of all testimony, the court indicated in its statement of decision that our client demonstrated through the testimony of the decedent’s family members, caregivers, and estate planning attorney that, notwithstanding the decedent’s terminal illness, the trust accurately represented the decedent’s true intent, that it was the decedent who had retained the services of her estate planning attorney to create the trust rather than our client, that the decedent had not been unduly influenced by our client to create the trust, and that the decedent had possessed the necessary capacity to execute her trust.
The court noted that a person does not necessarily lack the capacity to create a trust simply because they are facing death due to terminal illness. In fact, according to the court, it is at this stage in life, when a person is facing their own mortality, that they are inclined to put their affairs in order.
The court further held that Keystone’s client had appropriately administered the trust and had not caused the trust to suffer any monetary harm. The court’s ruling was a great win for both our client and the firm.
Thwarting a Conspiracy: Efforts by Decedent’s “Friend” to Control His Finances Fails Miserably
Keystone represented the only child of a decedent who was contesting the validity of her father’s purported trust restatement that left almost everything to a “friend” and nearly disinherited her, except for a small cash gift.
During the covid-19 pandemic, when the decedent had been living abroad in failing health, this opportunistic friend had taken advantage of the decedent in his vulnerable state and conspired with decedent’s caregivers and estate planner to make himself the primary beneficiary in the decedent’s estate planning documents, to the detriment of our client.
During the discovery process, Keystone uncovered substantial evidence corroborating its client’s suspicions — which was that the friend had orchestrated the whole scheme to take control of the decedent’s finances during his lifetime and amend his estate planning documents.
First, the friend had engaged the estate planning services of his former lover. He supplied the terms of the decedent’s purported restatement in email exchanges directly with the estate planner and is believed to have paid for the legal services himself.
Second, during this same period, the friend moved hundreds of thousands of dollars from the decedent’s bank accounts to his own accounts in unsubstantiated transfers.
Third, there were video and audio recordings showing that the friend and the decedent’s caregivers, in anticipation of a meeting with another independent attorney regarding the purported restatement, had coached the decedent on what to say. The recordings also revealed the decedent telling the friend that he “cannot read” the estate planning documents and that he’s “so confused.”
Fourth, the friend bribed the foreign caregivers with the prospect of a fraudulent marriage. This was confirmed with text messages that showed the friend was willing to enter into a “fake marriage” with the non-American caregiver so that he could obtain U.S. citizenship. The only catch was that the caregiver would have had to agree not to speak with Keystone’s client about the decedent.
Despite most of the witnesses living abroad and many of the documents either being unobtainable or in a foreign language, Keystone persevered to bring this evidence to light at mediation, resulting in a settlement overwhelmingly favoring our client.
Keystone was able to settle all the outstanding issues with the friend, estate planner and third-party trustee, and was successful in obtaining a court order invalidating the purported trust restatement as well.
Negotiation Strategy Paves Way for Favorable Settlement
Family discord can arise when a person chooses to gift their assets to only certain children or grandchildren and disinherit others in their estate plan. But when a person makes that decision free of undue influence, their wishes should be respected, and their intended beneficiaries should be free from harassing litigation. Unfortunately, it is all too common that disinherited family members take advantage of their blood relationship to a decedent to make a claim to the decedent’s estate or trust to which that family member has no entitlement.
This was the case for two of Keystone’s clients — sisters who inherited their grandmother’s home. The decedent had several children, but she ultimately chose Keystone’s clients as the beneficiaries of her home by naming them as beneficiaries on a transfer-on-death deed (TOD). Their grandmother had decided to leave them the property because of their demonstrated responsibility, integrity, and ability to continue their grandmother’s legacy of success. However, after the grandmother died, one of her daughters, the aunt of Keystone’s clients, challenged the transfer on death deed, claiming it had been the product of our clients’ undue influence.
Our client’s grandmother had good reason to disinherit this particular daughter. Keystone’s attorneys interviewed numerous witnesses — including neighbors, friends and even the challenging daughter’s own daughter (who herself was not a beneficiary of the estate) — all of whom described the troubled relationship the disinherited daughter had with her mother. She had caused problems for the decedent throughout her life and took advantage of her on countless occasions by asking her for money, getting into legal trouble, and even outright stealing from her.
Our attorneys used this evidence to demonstrate why the decedent had disinherited her daughter. Likewise, the decedent had been well within her rights to do so, as the law prioritizes preservation of a person’s valid and freely expressed testamentary wishes. After conducting further discovery, our attorneys also determined that there was no evidence suggesting that our clients played a role in their grandmother’s decision to leave them the property.
Bolstered by this evidence and compelling legal arguments, Keystone went into mediation with the goal of resolving the case for a minimal amount while avoiding the expense of further litigation. The mediator was able to see through the daughter’s bluster and realized the facts were overwhelmingly on the side of our clients. Keystone’s attorneys stood firm and found an avenue for settlement: giving a minimal cash payment to the daughter in addition to a car, which was coveted by the daughter and to which our clients had no particular attachment.
This negotiation strategy allowed Keystone’s clients to protect their rightful ownership of their grandmother’s former home, end expensive litigation early with minimal payment, and minimized the risk of additional challenges against their ownership by having the settlement agreement approved by the probate court. Keystone attorneys helped their clients preserve the decedent’s true testamentary wishes by aggressively and efficiently resolving a natural heir’s challenge.
Backed Into a Corner, Opposing Side Simply Gives Up
In this trust dispute case, Keystone represented a successor trustee who was also a beneficiary of her parents’ trust. She had been seeking to honor her parents’ true wishes, which had been to leave her 100% of the trust’s assets.
Although our client’s parents (the settlors) had three children, they had enjoyed an extremely close lifelong bond with only one child, our client. As a result, they had executed a trust that provided for the entirety of their assets to pass solely to her.
Unfortunately, the trust had not been drafted as clearly as the settlors had intended, which made it possible to interpret its provisions in multiple ways. This resulted in our firm having to file a petition for instructions with the probate court on our client’s behalf to confirm the true intentions of the settlors and to appropriately interpret the trust.
Not long after Keystone filed the petition, the settlors’ other two children, who had largely been estranged from their parents, emerged to file objections to the petition, arguing that the trust should be split into three equal shares because, as they shockingly claimed that the settlors had treated all three of their children equally and had no reason to not provide for all of them.
Upon receipt of the objections, Keystone immediately served written discovery requests to the two children to ascertain if their claims had any factual or documentary support. The responses that our firm received from them were vague, so we proceeded to depose them.
At their depositions, the siblings admitted on the record that they had no factual, evidentiary or documentary evidence to support their claims. As a result, Keystone filed a motion for summary judgment requesting the court to grant summary judgment to all of its client’s causes of action, because there was no dispute over the material facts necessary to resolve the issues in the petition. In other words, Keystone argued that its client should win her case outright without the need for a trial because the siblings had admitted to having no evidence whatsoever to support their claims.
Following the filing of the motion for summary judgment — but before the motion was heard and decided by the court — legal counsel for the two objectors contacted Keystone to resolve the case. The siblings effectively were offering to simply give up.
Ultimately, for almost nothing in return, the two children dismissed their objections and consented to the relief sought in Keystone’s petition, which locked in an extremely favorable result for our client. The best part? Our client was able to honor her parents’ true end-of-life wishes.
All Beneficiaries Must Be Paid
Though a person has the right to freely choose beneficiaries when creating their estate plan, some selections create more controversy than others.
Keystone’s client had been the friend and companion of a widower who left a substantial cash gift to her as part of his trust. Due in part to this decision, an acrimonious relationship developed between the widower’s adult children and Keystone’s client.
After the widower passed away, the trust fund distribution of the gift to our client was delayed for numerous reasons. First, the trustees of the widower’s trust were pursuing trust litigation relating to multiple trust assets. Second, the trustees also were in the process of resolving issues with the IRS. Third, the widower’s children were repeatedly raising objections to the payment of our client’s gift, citing various legal reasons why she should not be paid. Still, our attorneys successfully negotiated for monthly payments to be made to our client from the trust to partially satisfy her cash gift while these issues remained outstanding.
Once the litigation and issues with the IRS had been handled, the dispute between Keystone’s client and the widower’s children took center stage, revolving around the issue of whether Keystone’s client was entitled to priority payment under the terms of the trust, and what share of the trust’s taxes should be apportioned to our client’s gift.
The trustees of the trust kept insisting their hands were tied and could not make distributions to our client until these objections were resolved, so Keystone took action on behalf of its client by filing a petition to compel the trustees to prioritize payment of her gift based on the terms of the trust and applicable California law.
The widower’s trust was complex, as it required division into multiple sub-trusts after the death of his wife, reconstitution into a single trust after the widower’s death, and provisions for equalization of gifts between the children of the widower. Keystone attorneys carefully analyzed the trust language and California law to arrive at the conclusion that our client’s gift was to be paid from the widower’s sub-trust before the remaining assets of the widower’s sub-trust were combined with the assets in the sub-trust of the widower’s wife and distributed to their children.
Keystone attorneys put this analysis into action by filing a motion for summary adjudication, which asked the court to definitively rule on this issue without the need for a trial. Our attorneys were confident their argument would prevail based on their careful analysis of the law and of the language of the trust.
This motion put pressure on the widower’s children and trustees to pursue resolution. Our attorneys used this leverage to negotiate a favorable settlement. We wanted to ensure our client received nearly all of the gifts she was entitled to without additional delay.
Keystone stood up for its client’s rights in the face of competing interests, administrative hangups, and complex trust language to secure for its client the gift that had been intended for her.
Friends Don’t Financially Abuse Friends
In this trustee misconduct case, Keystone represented a private professional fiduciary who had been appointed as the temporary conservator of an elderly man with advanced Alzheimer’s disease.
The conservatee had previously executed a trust naming his friend as the successor trustee and sole beneficiary of his trust, but these designations were not to take effect until after his passing. However, a review of the conservatee’s financial and property records revealed that the friend had perpetrated both elder financial abuse and multiple breaches of fiduciary duty, including but not limited to the purchase of an automobile and a house across the country in the successor trustee’s home state – alluding trust assets.
While the assets were titled in the name of the trust, the successor trustee had moved her and her family into the home under the guise that the conservatee would eventually move across the country to live with them.
Keystone concurrently filed an ex parte petition for immediate suspension of the trustee and a petition for removal. Because of the egregious actions by the successor trustee, the court granted the ex parte petition at the first hearing, suspended the successor trustee, and appointed our client as the interim trustee while the petition for removal was pending.
Our firm then facilitated the sale of the conservatee’s residence in Beverly Hills via the court approval process, which resulted in a substantial amount of funds available for the conservatee’s care. Additionally, Keystone stopped the successor trustee’s efforts to personally collect proceeds from the sale of conservatee’s movie memorabilia and recovered the same for the benefit of conservatorship estate. Duty-bound to protect the conservatee, Keystone also filed a petition for breaches of fiduciary duty and elder financial abuse against the friend, seeking to permanently disinherit her from the conservatee’s trust.
With the new petition pending, the parties resolved the case at mediation. The resolution they reached heavily favored our client. The conservatee’s court-appointed counsel credited Keystone’s elder abuse petition as the motivating factor in the friend agreeing to resolve the matter.
Soon after, our client was appointed as permanent conservator and trustee of the conservatee’s trust, which will allow him to administer and protect the conservatee’s assets for the rest of his life. The conservatee now enjoys the quality of life he deserves and is free to live out his remaining days under the oversight of our caring and professional client.
Justice Served: A Case of Fraudulent Inheritance Claims
In this case, a disinherited daughter learned the hard way that stealing rarely pays off. Our firm was representing the co-executors of a decedent’s estate. The decedent had executed a valid will before his passing that intentionally, specifically, and expressly disinherited his estranged daughter with whom he had not spoken for approximately 20 years. He also had no relationship with her or her children. Instead, he had designated four charities he was passionate about to ultimately be his estate beneficiaries.
Approximately one month after the decedent’s untimely death, the co-executors of his estate shared his will with his disinherited daughter for informational purposes only. At the time of the decedent’s passing, he had owned real property in the Los Angeles area and several bank accounts. The co-executors soon thereafter initiated the probate process and began completing the necessary estate administration tasks.
While marshaling the assets of the estate, the co-executors learned that one of the decedent’s bank accounts had been closed by the decedent’s disinherited daughter shortly after his death, and after they had already notified her about the contents of her father’s will. Specifically, the co-executors learned from bank officials that the daughter had fraudulently represented that she was the rightful and sole heir to her father’s bank account and presented a Small Estate Affidavit signed under penalty of perjury that stated there were no probate proceedings for her father’s estate, that her father had no will, and that, as his sole surviving daughter, she was the rightful successor in interest.
Seeking to recover the stolen assets, Keystone filed a Probate Code section 850 petition against the daughter along with a request for double damages. Through our efforts, we successfully recovered every penny of the stolen funds from the daughter for the benefit of the estate without the need for a trial.
Our attorneys brought the estate administration to a close shortly thereafter, with all the stolen funds ultimately being distributed to the rightful charitable beneficiaries.
Protecting a Grieving Widow from Opportunistic Stepchildren
A client came to our firm for help after losing her beloved husband of 26 years. A year prior to his passing, our client and the decedent had executed a trust and transferred property into it. It had always been the decedent’s intent that the children he shared with our client would inherit the assets of the trust once he and his wife both died.
The decedent had 13 children from previous relationships, most of whom lived outside the U.S. Even though none of these children had a close relationship with the decedent or our client, they sensed an opportunity for potential financial gain upon learning of their father’s passing.
They proceeded to retain an attorney and filed a petition in the probate court to cancel the trust, alleging that Keystone’s client had procured the trust by means of elder financial abuse and undue influence while the decedent had been incapacitated. If a finding of elder financial abuse had been made, Keystone’s client would’ve run the risk of being disinherited, and being subject to enhanced remedies, such as double damages and liability for the opposing side’s attorney’s fees.
When the decedent’s surviving spouse first contacted us, litigation had been ongoing for years. Our client was wary of prolonged litigation and desired for the case to be resolved so that she could properly grieve her spouse and put this dispute behind her. Despite the parties having attempted to mediate at a mandatory settlement conference, they had made no progress.
Upon taking the case, Keystone realized that the petition filed by the decedent’s children from previous relationships failed to account for prior deeds that had been signed by the decedent and our client before the creation of the trust. The execution of these deeds meant that, even if the children were successful in setting aside the trust, our client still stood to inherit most of the trust’s assets — a fact that seemingly had been ignored by the children’s counsel.
Although the children’s claims were serious, Keystone knew it had a strong case. We were able to push the case to mediation and, with the help of the mediator, educate the opposing side. Eventually, our arguments compelled them to settle for a small fraction of the value of the trust’s real property assets. The result provided our client with the vast majority of the decedent’s estate and with the ability to remain in her longtime family residence.
Handwriting Unlocks the Truth
Keystone represented a brother in a dispute with his sister over a purported trust and corporate transfer letters, each allegedly executed by their mother who recently had passed away. The purported trust, which held the decedent’s residence, among other assets, disinherited our client, leaving everything to his sister. The transfer letters, which allegedly had been signed by the decedent shortly before her death, also sought to transfer the decedent’s entire ownership interest in two companies to the sister. The companies each held separate percentage ownership shares in commercial real estate, which meant that they provided a considerable income stream.
Keystone filed a petition to invalidate the trust and a Probate Code section 850 petition for the decedent’s estate to reclaim ownership in the companies. Substantial discovery was undertaken by Keystone on behalf of its client, thereby obtaining police, medical, financial, and the drafting attorney’s records via subpoena. These records showed that the decedent had been highly susceptible to undue influence, and that she had almost entirely relied upon our client’s sister for her essential daily needs. Subpoenaed bank records evidenced drastic changes in beneficiaries on various accounts, and the estate planning attorney’s records showed direct involvement by the sister in procuring the purported trust that disinherited our client.
Keystone subsequently deposed the sister. She claimed that she could not recall several extremely suspect financial transactions (one being a large six-figure check that was written by and payable to her). She was then asked to write sample words and phrases on a pre-printed sheet. After negotiations with opposing counsel, she slowly provided her handwriting samples.
When asked if she wrote any part of the transfer letters for the ownership of the companies, the sister initially denied doing so. Upon further questioning, however, she testified that she was “going back on her word because [she] [did]n’t want to lie” and admitted under oath to writing the dates on the transfer letters. The sister was visibly shaken by this admission, and the deposition was suspended shortly thereafter. The next day, the sister asked to go to mediation.
Mediation resulted in a highly favorable settlement for our client. He received over 90% of decedent’s ownership in the commercial real estate companies, resulting in a significant ongoing income stream for the present and future.
Girlfriend’s Sketchy Plan to Inherit Partner’s Assets Fails
In this case, Keystone represented the child of a decedent in bringing an elder financial abuse action against his father’s girlfriend. At a time when the decedent had been incapacitated and highly vulnerable due to advanced Alzheimer’s disease, his girlfriend systematically changed the beneficiary designations on his retirement accounts and life insurance policy, making herself the sole beneficiary, to the detriment of the decedent’s three children. She also arranged for the preparation and execution of the decedent’s estate planning documents, which named her as the sole beneficiary, contrary to the decedent’s longstanding testamentary intention to provide for his children.
Less than one month after the decedent allegedly signed the estate planning documents, the girlfriend had two of the decedent’s doctors declare the decedent to be mentally unfit to make financial and medical decisions, which subsequently allowed her to control the decedent’s finances and personal affairs through a power of attorney and healthcare directive that named her as his agent.
After the decedent’s condition deteriorated further to the point he could no longer drive, use a computer or phone, or leave the house, his girlfriend began isolating him, pushing family members away and rejecting their requests to help with his care. To make matters worse, she unilaterally made the decision to uproot the decedent from his California home of decades and move him to an out-of-state assisted living facility that was far away from decedent’s family and loved ones. Regrettably, the decedent passed away shortly thereafter.
Keystone worked closely with the client to initiate trust and will contests against the girlfriend. In litigation, Keystone issued numerous subpoenas to obtain business records from financial institutions, hospitals and estate planners, which resulted in significant evidence to support the client’s position. At mediation, Keystone was able to negotiate a highly favorable settlement to ensure that the decedent’s children would receive a significant part of his legacy.
Victory for Nieces and Nephews in Trust Dispute with Aunt's Partner
In a dispute over a trust, Keystone acted on behalf of a decedent’s nieces and nephews after a decedent made changes to their trust in the final two years of her life that effectively eliminated our clients’ inheritances.
Although the decedent didn’t have children, they shared a very close bond, similar to a parental relationship, with Keystone’s clients. As a result of this bond, the decedent had left approximately 80% of their substantial assets to them.
Unfortunately, the situation changed dramatically when the decedent reconnected with a former partner who had always harbored animosity towards the decedent’s family, including our clients. Following a debilitating accident and subsequent cognitive decline, the decedent became reliant on this partner, who isolated them from friends and family for over a year. During this time, the partner manipulated the decedent into signing three trust amendments that progressively disinherited the decedent’s family and friends and directed the decedent’s assets to pass to her.
Keystone’s legal team swiftly filed a petition with the probate court to challenge the trust amendments. An extensive investigation followed during which our attorneys obtained records from third parties, interviewed witnesses, and consulted medical experts. All of this led to Keystone facilitating a favorable settlement for its clients.
This settlement, reached without the need for a trial, ensured that Keystone’s clients would receive the majority of the trust estate, including most of the decedent’s valuable real estate investment portfolio. This restored much of what our clients would have inherited under the original trust.
Keystone Protects Elderly Client's Estate Plan from Son’s Manipulation in Divorce Action
In a divorce action between Keystone’s elderly client and his former spouse, Keystone actively worked as co-counsel with its client’s family law counsel to ensure that its client’s interests vis-à-vis his estate plan were adequately protected.
In this matter, Keystone’s client, who was in his late 80s, had been happily married to his second wife for more than 50 years. He had brought substantial property into the marriage and continued to build his wealth during it.Unfortunately, as the spouse began to age, she experienced a sharp decline in her mental competence.
It was during this time that one of her sons from her prior marriage began actively intervening in her financial affairs and making unwarranted threats against our client, falsely accusing him of taking financial advantage of his mother. Soon after, the son hired counsel for his mother and convinced her to file for divorce from our client, her husband of more than 50 years, which we argued was done so that he could seize control of our client’s assets. Eventually, the son physically removed his mother from the marital home and placed her in an assisted living facility near his home to further isolate her from our client.
Keystone worked with the client’s family law attorney, who relied on our team to provide counsel regarding the client’s estate plan and to assist with litigation on probate-related issues. As litigation co-counsel, Keystone helped secure the appointment of a neutral third party as the wife’s guardian ad litem over her son’s objection. We also petitioned for the wife to be placed under a probate conservatorship.
When Keystone’s client regrettably passed away in the middle of divorce proceedings, Keystone helped obtain an order permitting its client’s children to carry on with the divorce litigation in his stead, which still had to resolve the community and separate property issues. Ultimately, Keystone’s efforts helped to prevent the son of our client’s former wife from exerting unilateral control over his mother and led to a favorable settlement of the case prior to trial.
Sister Forced to Pay Sibling Handsomely for Her Misdeeds as Trustee
In 2004, when two sisters were about to receive substantial inheritances, one sister convinced the other (who eventually became Keystone’s client) to create an irrevocable trust to hold the entirety of her inheritance. She urged her sister to name her the trustee of her trust.
Although irrevocable, the trust required annual trust accountings by the trustee sister and monthly distributions of all income to the beneficiary sister. The trust provided for reasonable trustee compensation, but the trustee sister promised never to charge her beneficiary sister trustee fees.
The beneficiary sister contended that, over the next 14 years, the trustee sister would fail to account, fail to distribute monthly income, treat her interest in that trust as her own, engage in self-dealing, and misrepresent the rights she had in her own trust (including the right to remove the trustee).
At first, the beneficiary attempted to address these issues on her own. She obtained some accountings, after which the trustee proposed that she accept all the accountings and release all claims against her in exchange for her resigning. The trustee convinced the beneficiary to accept the offer by falsely representing that the beneficiary would not be able to regain control of her trust unless the trustee were to consent.
The beneficiary, unrepresented by counsel and still believing that the trustee had agreed to waive all trustee fees (which was consistent with drafts of the agreement), signed the final version of the release proposed by the trustee. Unfortunately, the final version of the release that the trustee had induced the beneficiary into signing provided — contrary to what the beneficiary believed had been negotiated — substantial compensation to the trustee. Further, after the agreement was signed, the trustee refused to resign and made a series of threats against the beneficiary.
The sisters’ parents also had created a trust, which provided, upon their passing, for distribution of equal shares to both sisters. By this time, the trustee sister had also become the successor trustee of her parents’ trust.
The beneficiary first retained another law firm, who gave notice to the trustee’s counsel that its client’s trust had been terminated. It also sought to resolve any disputes between the sisters, including by enforcing the beneficiary’s rights to trust assets and the trustee’s prior agreement to decline any compensation. When the trustee refused to cooperate, the beneficiary and her firm brought in Keystone as co-counsel to help her enforce her rights.
Litigation was started to confirm termination of our client’s trust, to compel the distribution of assets still in that trust, to enforce the waiver of the trustee’s claim for compensation in excess of $250,000, and to surcharge the trustee for fiduciary misconduct.
Our client contended that the agreement she and the trustee had signed, which released the trustee and into which a provision for trustee compensation had been inserted, had been fraudulently obtained and was invalid. Separate litigation was filed to obtain information about the administration of parents’ trust, both before and after the trustee sister became successor trustee.
In response, the trustee sought to enforce the release our client had signed relating to her trust. She claimed that the release included waiving any objections to the compensation the trustee had been requesting. As for the parents’ trust, the trustee refused to produce any trust records in her possession that related to the time before she formally became successor trustee of that trust, even though that trust provided its beneficiaries an unrestricted right to review the trust’s books and records.
The trustee had used the assets of the trusts to pay her litigation costs, including her attorney fees. Our client was alleging the trustee had threatened that if she were to sue her, she would prolong litigation to exhaust all remaining assets in the trusts to pay her attorney fees.
The parties began exercising their discovery rights in litigation, with the trustee vigorously resisting our client’s attempts to obtain information, especially information about the parent’s trust. The trustee also had been trying to enforce the release around our client’s trust. By the time the parties were prepared to discuss whether a settlement could be negotiated, the trustee had, indeed, used all the remaining assets in her parents’ trust and a substantial portion of the assets in our client’s trust to cover her attorney fees.
After lengthy direct negotiations between counsel, an unsuccessful mandatory settlement conference presided over by a judge, and further direct negotiations, the parties ultimately agreed to settle their disputes. The settlement, which later was approved by the court in which the litigation was pending, provided for a substantial sum to be paid to our client. A portion of this settlement would originate from distribution of the remaining assets in her own trust and another portion would be paid from the trustee’s personal funds. The parties also released each other from all disputes between them and terminated our client’s interest in the trusts.
Previous Successes
We hope you enjoyed reading about our success stories. If you want to read more, read about Keystone’s successes in 2018, 2019, 2020, 2021, and 2022.
If you are dealing with a complicated trust or estate matter, Keystone’s probate attorneys are well-equipped to obtain a favorable resolution for your case. Because Keystone attorneys practice exclusively in probate law, they have an acute and nuanced understanding of probate matters, as well as years of experience in the field. Learn how we can help you with your legal issue by requesting a free consultation.
