Estate of
Filed 11/14/13 Estate of Richardson CA4/1
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COURT
OF APPEAL, FOURTH APPELLATE DISTRICT
DIVISION
ONE
STATE
OF CALIFORNIA
Estate of JOHN RICHARDSON,
Deceased.
DONNA TOBEY,
Petitioner and Respondent,
v.
DIANE STRETTON,
Objector and Appellant.
D062276
(Super. Ct.
No. P182652)
APPEAL from
an order of the Superior Court
of
County, Julia C. Kelety, Judge. Affirmed.
Diane
Stretton, in pro. per., for Objector and Appellant.
The Krupa
Law Group and Lori L. Krupa for Petitioner and Respondent.
Diane
Stretton appeals from a probate court order denying her
judge (Code Civ. Proc., § 170.6), and rejecting her objections to a status
report on the administration of her father's estate.
SUMMARY
OF RELEVANT FACTS AND PROCEDURE
John
Richardson (Father) died more than 11 years ago. At the time of his death, he was involved in
after they had been married for about 56 years. Mother died in 2003. Because this appeal concerns only Father's
estate, we omit references to Mother and her estate except where relevant to
the issues before us.
Father and
Mother left three adult daughters: Stretton,
Donna Tobey, and Sharon Freeburn. In his
will, Father named Tobey as executor, identified Tobey and Freeburn as the sole
beneficiaries, and specifically and expressly omitted Stretton as a beneficiary.
Before his death, Father had revoked a
trust that had designated Stretton as a beneficiary. Although Stretton challenged the will and
trust revocation, Stretton was unsuccessful in those challenges. Thereafter, Stretton had no legal basis to
seek any benefits under Father's estate or trust.
Six years
after Father's death, in February 2006, Stretton was declared a vexatious
litigant based, in part, on her numerous unsuccessful filings in Mother's and Father's
estate proceedings. Stretton was
required to obtain permission from the superior court presiding judge before
filing new litigation in the probate proceedings.
One focus
of Stretton's prior unsuccessful litigation efforts was a deed of trust held by
Father and Mother encumbering Stretton's real property in Lake Forest,
California, referred to as the "Sleepy Hollow" property. The deed of trust on the Sleepy Hollow
property secured a loan of approximately $256,000 from Father and Mother to
Stretton. In prior proceedings, Stretton
claimed the deed of trust was invalid for numerous reasons, including that there
was no underlying promissory note and the deed of trust was merely a vehicle to
ensure Stretton's former husband did not obtain rights to the property. However, in a 2006 final judgment resolving a
claim brought by Stretton against Father's and Mother's estates, the court (Judge
Lisa Guy-Schall) rejected these arguments, and made an express finding that the
parents' deed of trust on the Sleepy Hollow property was valid and reflected
security for unpaid loans from Father and Mother to Stretton.
Thereafter,
the probate court confirmed that the Sleepy Hollow property should be
sold. Based on an appeal filed by
Stretton relating to Father's trust revocation, the probate court initially issued
an order staying the sale. However, the probate
court ultimately lifted this stay after it determined the sale was unrelated to
Stretton's challenge to the trust revocation. Before this sale order was executed, in March
2010, the Orange County tax assessor's office held a nonjudicial foreclosure
sale of the Sleepy Hollow property (based on a failure to pay owed taxes) and
sold the property at an auction for approximately $382,800.
In August
2011, executor Tobey filed a second report on the status of the estate administration
and a request for orders continuing the administration and for certain
distributions and fees for the executor and her attorney (August 2011 petition).
Tobey and her attorney filed supporting declarations
and memoranda discussing the status of the estate. In these papers, Tobey noted that Father's estate
is insolvent and the estate owes her money for amounts she personally paid for
fees charged to the estate. Tobey also indicated
that neither she nor her attorney has been paid for their services. Tobey additionally discussed the financial
burden to the estate from Stretton's litigation and from malpractice by a prior
estate attorney.
With
respect to the Sleepy Hollow property, Tobey informed the court of the nonjudicial
foreclosure sale and that she has a pending claim in Orange County for the
estate's share of the net sales proceeds. Tobey stated that Stretton had filed a lawsuit
contesting the foreclosure sale in Orange County, but the lawsuit was
dismissed. In a supplement filed two
months later, Stretton stated that a payment from the "County of Orange in
the amount of $173,323.65 was received in early September and is on deposit
[with Tobey's counsel's law firm]."
In response
to Tobey's August 2011 petition, Stretton moved to disqualify Judge Julia Kelety,
who had recently been assigned to preside over Father's estate.
relating to the Sleepy Hollow property, essentially challenging the fact that
the Sleepy Hollow property was included in Father's estate. In support, Stretton raised numerous arguments,
including that Father's deed of trust on the property was void and Father's
estate was collaterally estopped from claiming an interest in the Sleepy Hollow
property based on a family court order involving the dissolution between Mother
and Father.
On December
6, 2011, Judge Kelety held a hearing at which Stretton and Tobey's counsel appeared. Later that day, the court issued an order
denying Stretton's disqualification motion, finding that Stretton had no
standing to bring the motion. The court
stated: "By its terms, only a party
may bring a 170.6 motion. Ms. Stretton,
however, has been adjudged not to have any standing with respect to the
administration of this Estate. . . . These
rulings are the law of the case in this matter.
Ms. Stretton, as obligor on a Deed of Trust owned by the Estate, is at
best a debtor of the estate. She lacks
standing to challenge the estate's administration and is therefore not a party
to these proceedings." The court
also issued a minute order approving Tobey's status report and preliminary
distribution requests. In this ruling,
the court did not specifically address or refer to the Sleepy Hollow property,
but the court stated that Tobey was authorized to use any additional funds
received by the estate to pay herself for amounts owed to her by the estate.
On appeal, Stretton
challenges these December 6, 2011 rulings.
DISCUSSION
I. Disqualification
Motion
Stretton contends the court erred in denying her section
170.6 peremptory challenge.
name="_ftnref3" title="">[3]
Section
170.6 prohibits a judicial officer from acting in "a civil or criminal
action or special proceeding" if a statutory affidavit of prejudice is filed
by "[a] party to, or an attorney appearing in, [the] action or proceeding
. . . ." (§ 170.6, subd.
(a)(1), (2).) Under this code section,
only a "party" to the proceeding or the party's attorney may file a
section 170.6 challenge. (§ 170.6,
subd. (a)(2); Avelar v. Superior Court
(1992) 7 Cal.App.4th 1270, 1274.)
In estate
proceedings, whether an individual is a party depends on whether he or she is
an "interested person" with respect to the particular
proceeding. (Estate of Davis (1990) 219 Cal.App.3d 663, 668.) Probate Code section 48, subdivision (a)(1) identifies
various parties who may qualify as an "interested person," but limits
these definitions to an individual having a property right in, or claim against,
an estate that may be affected by the probate proceeding. (Lickter
v. Lickter (2010) 189 Cal.App.4th 712, 728; see Ross & Cohen, Cal.
Practice Guide: Probate (The Rutter
Group 2013) ¶ 3:84.1, p. 3-32.) Under
this statutory definition, an heir is not an "interested party" if a
court has previously determined the heir is not a beneficiary under the estate
documents. (See Lickter, supra, at pp. 732-733; Estate
of Powers (1979) 91 Cal.App.3d 715, 719-722.)
The probate
court did not err in concluding Stretton was not a party to the proceeding on Tobey's
August 2011 petition. Although Stretton
was an "heir at law," she had been expressly disinherited under
Father's will. Thus, Stretton was not a
beneficiary who had standing to object to a status report or a preliminary distribution
request. (See Prob. Code, §§ 48,
subd. (a), 11600, 11602.) The court
properly denied Stretton's section 170.6 disqualification petition on the
ground that Stretton was not an interested party in the proceedings.
Stretton
argues that she was an interested party because she was a former owner of the
Sleepy Hollow property and was challenging the estate's claim to this property. However, the issue of the ownership of the
property was not before the court on Tobey's August 2011 petition. Tobey's August 2011 petition did not request
the court to make any order pertaining to that claim, and sought only an order
for distribution of those funds after they had been paid to the estate by a
governmental agency. Because Stretton
was not a beneficiary or creditor of Father's estate, she had no interest in the
manner in which the funds were distributed once they were paid to the estate.
Additionally,
the issue of Tobey's right to enforce the deed of trust had already been
adjudicated in prior probate proceedings.
In 2006, the superior court issued a final judgment stating that Father's
deed of trust on the Sleepy Hollow property was valid and enforceable. Thereafter, the probate court ordered the Sleepy
Hollow property sold and, in an unrelated action, the property was sold in a
nonjudicial foreclosure sale held by Orange County for an unpaid tax lien. A party has no standing to object to a
petition seeking preliminary distributions for the purpose of relitigating
issues that were already decided by final orders. (See Estate
of Gump (1940) 16 Cal.2d 535, 549.)
We also reject
Stretton's contention that Tobey waived her right to object to Stretton's
participation in the proceedings because Stretton had previously participated in
probate hearings involving Father's estate.
The fact that Stretton may have been an interested party in prior
proceedings when she had a direct interest in the outcome (for example, where
she claimed that Father had not revoked his earlier trust) does not mean she
had a continuing interest. (See Prob.
Code, § 48, subd. (b) ["meaning of 'interested person' as it relates
to particular persons may vary from time to time and shall be determined
according to the particular purposes of, and matter involved in, any proceeding"];
Estate of Davis, supra, 219
Cal.App.3d at p. 668 ["a party may qualify as an interested person
entitled to participate for purposes of one proceeding but not for another"];
see also Arman v. Bank of America (1999)
74 Cal.App.4th 697, 702-703.) By the
time of Tobey's August 2011 petition, it had been finally determined that
Stretton was not a beneficiary under any estate document and had no standing as
a creditor under any possible theory.
II. Stretton's
Challenges to the Nonjudicial Foreclosure Sale and to the Deed of Trust
Stretton also
contends the court erred in "[f]ailing and refusing to hear [her]
objections to the appraisal of the TD [referring to the Sleepy Hollow deed of
trust] before distributing the proceeds of the TD . . . ." This contention is without merit. First, as discussed above, Stretton had no
standing to object to the appraisal of the property or the distribution of
funds from the sale because she was not a beneficiary or creditor of the
estate. (Prob. Code, § 48, subd.
(a).)
In her
appellate briefs, Stretton argues that her constitutional
rights were violated because she was deprived of her Sleepy Hollow property
without due process. The record does not
support this claim.
In February
2006, the superior court entered a judgment in a lawsuit brought by Stretton
against Father's estate and others. One
of the issues in the lawsuit was the validity of the parents' deed of trust on
the Sleepy Hollow property and whether that deed of trust was security for
loans totaling approximately $253,875. In
a tentative statement of decision, the court stated that the "defense . . .
provided detailed accountings, clear documentation, clear recollections, and
uncontroverted evidence that loans totaling $253,975 were in fact given to . .
. Stretton [by her parents] . . . . [Additionally], the evidence is overwhelming
that the deed of trust on Sleepy Hollow was validly prepared, signed and filed
as a reflection of those past loans.
There is no evidence to suggest that any fraud was ever perpetrated by
any parties in the preparation and the filing of said deed of trust, and
therefore this Court finds it to be valid." The final judgment in the action, filed
February 1, 2006, states: "[T]he
deed of trust secured by the Sleepy Hollow residence . . . is valid and
enforceable."
Despite
this final judgment, Stretton continued to raise the same challenges to the Sleepy
Hollow deed of trust at various other proceedings, including in opposition to
Tobey's petitions to sell the Sleepy Hollow property and to lift the stay on
the sale. Each of these challenges has
been rejected by the court.
Stretton
was not denied her constitutional rights.
Stretton had the prior opportunity to fully litigate the issues regarding
her ownership of the Sleepy Hollow property and whether the deed of trust in
favor of Father and Mother was valid and enforceable.
Stretton
argues that a prior order in her parents' dissolution proceedings required the
parties to seek an "equitable mortgage before claiming any interest in
Stretton's real property." However,
any such family court order was preempted by the probate court's later
orders. Moreover, as we have stated, the
validity of the nonjudicial foreclosure sale was not before the probate court
on Tobey's August 2011 petition. Tobey
did not trigger that sale; instead the sale was conducted by Orange County on
an unpaid tax lien.
Stretton
contends she did not have notice of the proceeding regarding Tobey's August
2011 petition. However, as a nonparty to
the proceedings, she was not entitled to notice. In any event, the record supports that Stretton
did have actual notice because she filed extensive opposition papers and she
appeared at the hearing.
In her
reply brief, Stretton raises various claims regarding certain real property
located in Riverside County. However,
she did not raise these issues in opposition to Tobey's petition below and
therefore the issues are not properly before us. Moreover, as with the Sleepy Hollow property,
Stretton is not an interested party entitled to raise objections to the court's
distribution of the Riverside property.
Stretton
raises numerous additional contentions in her appellate briefs. We have considered each point and found that
none of these arguments shows the court erred in its December 6 rulings.
DISPOSITION
Affirmed. Appellant to pay respondent's costs on
appeal.
HALLER, J.
WE CONCUR:
HUFFMAN, Acting P. J.
NARES, J.
name="_ftn1" title="">[1] Statutory references are to the Code of Civil Procedure
unless otherwise specified.
name="_ftn2" title="">[2] During the previous 10 years, numerous superior court judges
had ruled on various aspects of the probate and estate litigation, including
Judge Lisa Guy-Schall, Judge Thomas LaVoy, Judge Linda Quinn, and Judge Gerald
Jessop.
