Packard v. Packard is a significant decision that reinforces California’s modern, intent-centered approach to trust interpretation and reformation. By holding that a reformation petition is not a trust contest, the Court of Appeal preserved an essential mechanism for correcting mistakes and honoring settlors’ true intentions.
In an era where estate plans are increasingly complex—and often modified informally (by the Settlors themselves) later in life—Packard ensures that courts retain the flexibility necessary to prevent unjust enrichment and effectuate fairness, without being constrained by rigid procedural bars that were never intended to apply.
Case Overview
Newton Roy Packard created the Newton Roy Packard Trust in 2010. Under its original terms, Newton’s two adult sons, Gregory Roy Packard (Greg) and Scott Eric Packard (Scott), were to receive equal shares of the trust estate upon Newton’s death. Greg was designated as first successor trustee, and Scott as second successor trustee. The trust also included a standard no contest clause providing for forfeiture if a beneficiary contested the trust.
In 2012, Newton executed a First Amendment to the trust. The amendment altered the distribution scheme by providing that Greg would receive Newton’s residence outright, while Scott would receive a sum equal to the value of that residence, as determined by an independent appraisal. After the equalizing payment, the remaining trust assets would be divided equally between the brothers.
Two years later, in 2014, Newton made a handwritten interlineation on the First Amendment. He inserted the words “one-half” before “the value of the house,” initialed the change, and dated it. As modified, the Amendment now read “Scott gets ‘one-half’ value of the house…”
Newton died in 2020. Greg became successor trustee. An appraisal valued the house at $970,000. Greg served Scott with a Probate Code section 16061.7 Notice, triggering the 120-day period for filing a trust contest.
More than 120 days later, Scott filed a petition for construction and reformation of the First Amendment. Scott alleged that Newton’s handwritten insertion of “one-half” reflected a mistake in expression, not a change in intent. According to Scott, Newton always intended that his sons receive equal distributions, and he mistakenly believed that inserting “one-half” would preserve equality when, in fact, it disrupted it. Greg objected to Scott’s petition, asserting that Scott was only to receive a distribution equal to half the value of the property, not the full value of the property.
Greg responded with a motion for judgment on the pleadings, arguing that Scott’s petition was, in substance, a trust contest barred by section 16061.8. The probate court agreed, concluding that the handwritten language was unambiguous and that Scott’s requested relief would effectively invalidate the amendment. The court dismissed the petition without leave to amend.
Scott appealed.
Appellate Court Chose Substance Over Labels
The Court of Appeal began by emphasizing that whether a pleading constitutes a trust contest depends on its substance and practical purpose, not its title or caption. The Appellate Court stated courts must look beyond captions to determine whether a claim seeks to invalidate a trust instrument or instead seeks to interpret or enforce the trustor’s intent.
While section 16061.8 bars untimely “actions to contest the trust,” the statute does not define “contest.” Drawing on precedent, the court reiterated that not every action affecting trust distributions is a contest. Historically, petitions for construction or interpretation have not been treated as contests, even when they result in the invalidation or modification of certain provisions.
Reformation vs. Contest
The Appellate Court placed particular emphasis on drawing a distinction between a petition for construction or reformation and a petition to contest the trust instrument. A trust contest seeks to invalidate the trust or amendment (e.g., for lack of capacity, undue influence, or forgery), while the purpose of a petition for construction or reformation seeks to ascertain the trustor’s intent and enforce it.
Scott did not allege that Newton lacked capacity, was unduly influenced, or that the amendment was invalid. Instead, he alleged that Newton mistakenly believed his handwritten change would preserve equal treatment of his sons. This distinction was critical. As the court explained, “reformation does not thwart the trustor’s intent—it seeks to carry it out.”
Extending Estate of Duke to Trusts
In the attempt to ascertain the trustor’s intent, Greg argued, and the trial court agreed that the handwritten phrase “one-half” was unambiguous, therefore extrinsic evidence was inadmissible, and reformation was improper. The Appellate Court, relying on Estate of Duke (2015) 61 Cal.4th 871, abandoned the historical precedent barring extrinsic evidence to reform an unambiguous will (or trust). The Appellate Court reasoned that a court may consider extrinsic evidence to reform even facially unambiguous language if clear and convincing evidence shows both a mistake in expressing intent and what the testator intended.
Appellate Court Rules Reformation Is Not A Contest
Here, the Court of Appeal held that Scott’s petition for construction and reformation was not a trust contest, as it sought to enforce the trustor’s intent and not invalidate the trust amendment. As a result, the probate court erred in granting judgment on the pleadings as the petition for construction and reformation was not subject to the 120-day statute of limitations under Probate Code section 16061.8.
Conclusion
Packard v. Packard stands as an important reaffirmation of California’s commitment to effectuating a trustor’s true intent. The Court of Appeal’s decision makes clear that a petition seeking reformation to correct a mistake in the expression of intent is fundamentally different from a challenge to a trust’s validity and therefore falls outside the narrow scope of a statutory trust contest. By clarifying this distinction, the court preserved an essential avenue of relief for beneficiaries confronted with drafting or expression errors, while maintaining the integrity of the statutory framework governing trust administration.
Key Takeaways
- Reformation ≠ Contest: The Packard decision draws a clear line that a claim for reformation or construction does not challenge the validity of a trust and therefore is not subject to the 120-day limitations under Probate Code sections 16061.7 and 16061.8.
- Extending Estate of Duke to Trusts: The Packard court abandoned long-held precedent and ruled that extrinsic evidence may be admitted to correct an error in expressing a settlor’s intent, even when the written terms of the trust appear clear on their face.
- Never Write On Your Estate Planning Documents: The issues in Packard arose due to the trustor writing just a couple of words on his trust amendment. Although the trustor may have meant well, those handwritten words led to years of litigation. If you want to change or amend your estate plan, even if it is adding just a few words, it is best to consult with an estate planning attorney first.
Still have questions about reformation vs. trust contests?
If you’re navigating a situation where a trust amendment may contain mistakes—or you’re unsure whether seeking clarification could trigger a trust contest—it’s essential to understand your options before critical deadlines pass.
The probate attorneys at Keystone can help you evaluate whether reformation is appropriate, interpret the trustor’s intent, and guide you through the nuances clarified by Packard v. Packard. Contact our firm today to learn how we can assist.
