Fear Not Law Articles: Farmers & Merchants Trust v. First American Trust

Farmers & Merchants Trust v

Farmers & Merchants Trust v. First American Trust

Filed 1/31/07 Farmers & Merchants Trust v. First American Trust CA4/3

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

California Rules of Court, rule 977(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 977(b). This opinion has not been certified for publication or ordered published for purposes of rule 977.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FOURTH APPELLATE DISTRICT

DIVISION THREE

FARMERS & MERCHANTS TRUST COMPANY, as Trustee etc.,

Plaintiff and Appellant,

FIRST AMERICAN TRUST COMPANY, FSB,

Defendant and Respondent.

G037020

(Super. Ct. No. A212767)

O P I N I O N

Appeal from an order of the Superior Court of Orange County, Marjorie Laird Carter, Judge. Affirmed in part and reversed in part.

Law Offices of Michael Leight, Michael Leight and John Gloger for Plaintiff and Appellant.

Casey & Richards, Wayne J. Casey; King & Parret and Charles W. Parret for Defendant and Respondent.

* * *

Farmers & Merchants Trust Company (F& M), the trustee of the Violet McNaughton Family Trust (trust), appeals from an order awarding trustee and attorney fees and costs of suit to First American Trust Company, FSB (First American), the trust's former trustee. F& M contends First American incurred the fees and costs after it had resigned as trustee, a purported settlement reached before First American resigned cannot support the award because the settlement is unenforceable, and the trial court erred in failing to rule on its evidentiary objections. We conclude First American is entitled to recover fees and litigation expenses to the extent they arose from its residual duties as trustee, but not for its participation in unrelated legal proceedings. Since the trial court awarded a lump sum for all of First American's activities, the matter must be remanded to the superior court for further proceedings.

FACTUAL AND PROCEDURAL BACKGROUND

Violet McNaughton created the trust in 1987. She was its sole beneficiary during her lifetime. Upon her death, the trust provided for distribution of its assets to, among others, Kent McNaughton (Kent), her sole surviving child.

McNaughton also served as the trust's initial trustee. In part, the trust provided that if she â€

Description	Farmers & Merchants Trust Company (F and M), the trustee of the Violet McNaughton Family Trust (trust), appeals from an order awarding trustee and attorney fees and costs of suit to First American Trust Company, FSB (First American), the trust's former trustee. F and M contends First American incurred the fees and costs after it had resigned as trustee, a purported settlement reached before First American resigned cannot support the award because the settlement is unenforceable, and the trial court erred in failing to rule on its evidentiary objections. Court conclude First American is entitled to recover fees and litigation expenses to the extent they arose from its residual duties as trustee, but not for its participation in unrelated legal proceedings. Since the trial court awarded a lump sum for all of First American's activities, the matter must be remanded to the superior court for further proceedings.
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