Trust Modifications and Revocations - Part IV

In the Court of Appeals deliberation, they concluded that the settlors bound themselves to a specific method of modification, accordingly, as specified under section 15402, the trust can only be amended in that manner. So for the amendments to be effective, it should have been signed by both Zoel and Edna. For the Court of Appeals to hold otherwise would thwart the very intent of the settlors, particularly since the amendment provision is more restrictive than the revocation provision.

The Court of Appeals also recognized that due to Edna's incompetence, she could not execute a trust amendment. However, the trust instrument provided a remedy for this situation. If a conservator or guardian had been appointed for Edna, the court that appointed the guardian or conservator could have authorized a trust amendment.

The Court of Appeals further reasoned that if they were to adopt the appellant's (David) position and hold that a trust may be modified by the revocation procedures set forth in section 15401, unless the trust explicitly provides that the stated modification method is exclusive, this would render the provisions of section 15402 superfluous. The Legislature would not have enacted a separate section for trust modification as provided in section 15402, unless it meant to have separate sets of rules to apply to trust revocation and modification. Rather than enacting section 15402, the Legislature could have combined revocation and modification into one statute.

Accordingly, based on the above, the Court of Appeals denied the motion to dismiss the appeal. The trial court's decision was affirmed.

*This blog entry was not written by an Attorney and should not be construed as professional legal advice.

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