Tierney v. Stacey

Filed 9/29/06 Tierney v. Stacey CA2/8

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 977.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

SECOND APPELLATE DISTRICT

DIVISION EIGHT

APPEAL from a judgment of the Superior Court of Los Angeles County, Joseph E. DiLoreto, Judge. Reversed and remanded. Orders vacated.

Jeffrey L. Garland; and Robert B. Corsun for Defendant and Appellant.

Velasco Law Group, Richard J. Radcliffe; Madden, Jones, Cole & Johnson, and Montegomery Cole for Plaintiff and Respondent.

* * * * * *

On October 28, 2004, the trial court entered a judgment, following a trial held on October 7 and 8, 2004, that decreed that certain purported amendments, dated March 8, 2002, to the Edna P. Tierney Living Trust (hereafter Tierney Trust), dated August 3, 1999, are “void due to the fact that the purported Amendments and Restatements executed March 8, 2002, were the product of undue influence exercised by . . . Marie E. Stacey.” The petitioner in the proceedings concluded by this judgment was Patricia M. Tierney (Tierney). Appellant Stacey filed a timely notice of appeal from this judgment. This appeal was docketed as Tierney v. Stacey, B180387.

On September 9, 2005, Tierney filed an “EX PARTE APPLICATION FOR REMOVAL OF TRUSTEE AND APPOINTMENT OF TEMPORARY TRUSTEE PENDING APPEAL” in which she sought the following orders: (1) Removing appellant Stacey as trustee of the Tierney Trust; (2) Directing Stacey to pay Tierney the sum of $115,442.20 in cash, which was allegedly the value of the assets held by Edna Tierney at the time of her death; (3) Directing Stacey to pay Tierney the sum of $34,667.72 in cash, which was allegedly the sum of all funds “improperly paid during [Edna Tierney’s] lifetime to [Stacey], [Stacey’s] family members, [Stacey’s] attorneys and/or other third party payees for services rendered for the benefit of [Stacey] and/or her family”; (4) Appointing Tierney as temporary trustee of the Tierney Trust pending the appeal in B180387; (5) Directing Stacey to execute a grant deed transferring a residence at 3923 McNab Avenue in Long Beach to Tierney.

On September 9, 2005, the Hon. Joseph DiLoreto^[1] granted each of the requests contained in Tierney’s ex parte application, and entered orders granting Tierney’s requests. Stacey filed a timely notice of appeal from these orders. This appeal was docketed as Tierney v. Stacey, B187641.

Appellant Stacey informs us that the parties have entered into a written agreement under which they stipulated to stay the enforcement of the judgment, as well as the enforcement of the ex parte orders of September 9, 2005. (Under the agreement, appellant has signed a grant deed for the property at 3923 McNab Avenue and has delivered that deed to the clerk of the trial court “for further delivery to the prevailing party.”)

On February 16, 2006, based on a stipulation between the parties, we consolidated B180387 with B187641 under the former number. Although the appeals remain consolidated, we address separately the issues raised in the appeal from the October 2004 judgment and in the appeal from the orders entered on September 9, 2005.

THE APPEAL FROM THE JUDGMENT OF OCTOBER 28, 2004

Appellant propounds two arguments concerning the judgment entered on October 28, 2004. First, appellant contends that the trial court erred in not causing a statement of decision to be prepared and filed. Second, appellant claims that the judgment is not supported by substantial evidence.

We conclude that a statement of decision should have been prepared and filed. As we explain below, this requires a reversal of the judgment and a remand for the preparation and filing of a statement of decision, and the entry of a new judgment based on that statement of decision. It is therefore unnecessary for us to address the second of appellant’s contentions

In the bench trial that took place on October 7 and 8, 2004, five witnesses, including respondent Tierney, testified for the latter and three witnesses, including appellant Stacey, testified for appellant. The trial testimony occupies 283 pages of the Reporter’s Transcript. The trial court’s comments and analysis of the evidence after both sides had rested and presented arguments, i.e., its statement of intended decision, extends to 21 pages in the Reporter’s Transcript. The trial court concluded its statement of intended decision by stating that it “will find the purported amendment dated March 8, 2002 void due to undue influence of the respondent [Stacey].” The following then transpired:

“[THE COURT:] I’ll ask counsel for the plaintiff [Tierney] to prepare -- in this case it wouldn’t be a notice of ruling, it would be an order. I’m not sure.

“MR. COLE [counsel for Tierney]: I believe an order is what we need in response to this petition.

“THE COURT: Would it be an order or a judgment? It could be an order or a judgment, a judgment based upon the court’s ruling today, and prepare that for my signature, and that concludes the hearing today.

“MR. COLE: Thank you, Your Honor.

“MR. CORSUN [counsel for appellant Stacey]: Can we ask for a Statement of Decision?

“THE COURT: Absolutely. It’s over one day, so you have the absolute right. You have within a certain time period to set forth the factors, because I’ve given you a Statement of Decision. The court will indicate that counsel for the plaintiff, you will be directed pursuant to the code to prepare the Statement of Decision. The problem is that asking for it now without telling me what you need and sending that to counsel is a -- the statutory requirements require you to in fact set forth what findings you require or what issues of fact or potential law that are in dispute. This is a ruling that is obviously subject to the completion of the Statement of Decision, and the court has the right to in fact, and has the obligation to correct any factual findings that I may have made that may be inaccurate once that’s prepared by the plaintiff.

“MR. CORSUN: I’ll discuss it with counsel.”

Other than a stipulation regarding the return of the exhibits to the parties, this concluded the trial, the court’s remarks and the discussion of the statement of decision.

A statement of decision was not prepared. The record does not contain anything further, i.e., other than the quoted exchange, regarding the statement of decision.

A statement of decision must be requested within 10 days after the court announces its tentative decision. (Code Civ. Proc. § 632 [hereafter § 632].) If the question by counsel, “Can we ask for a Statement of Decision,” is a request for a statement of decision, the request was timely.

According to Witkin,^[2] citing In re Marriage of Ananeh-Firempong (1990) 219 Cal.App.3d 272, 284, the request may be oral. We note that there is one decision to the contrary, Martinez v. County of Tulare (1987) 190 Cal.App.3d 1430, 1434, which held, without citing authorities, that the request for a statement of decision must be in writing. We think the better view is that the request may be oral. Section 632, which governs statements of decisions, appears to be open to oral proceedings,^[3] very possibly in order to minimize needless formalisms. We also agree with the observation of the court in In re Marriage of Ananeh-Firempong, supra, at page 283, commenting on Martinez v. County of Tulare, that the court in the latter case cited no authority, and gave no reasons, why the request should be in writing.

If the statement “Can we ask for a Statement of Decision” is construed to be a timely oral request for a statement of decision, the difficulty arises with the provision of section 632 that states that a request for a statement of decision “shall specify those controverted issues as to which the party is requesting a statement of decision.” The trial court clearly had this in mind when it stated that “[t]he problem is that asking for it now without telling me what you need and sending that to counsel is a -- the statutory requirements require you to in fact set forth what findings you require or what issues of fact or potential law that are in dispute.”

We are faced with two problems. First, the record is ambiguous on whether a statement of decision was actually requested. The question by counsel, “Can we ask for a Statement of Decision,” may or may not have been a request. There is some indication that the trial court, in making its closing remarks, understood it to be a request.^[4] Second, if a statement of decision was requested, it did not “specify those controverted issues as to which the party is requesting a statement of decision.” The request was therefore defective.

There are three reasons why we resolve the ambiguity in favor of the conclusion that a statement of decision was requested.

First, an extraordinary aspect of this case is the trial court’s ex parte orders of September 9, 2005. We address the merits of those orders in the section devoted to the appeal from the ex parte orders. (Text, post, p. 11.) At this point, we only note that, absent a statement of decision, one cannot say whether the court, in entering the judgment of October 28, 2004, found the predicate facts that are required to sustain the ex parte orders of September 9, 2005.

Specifically, we have been made aware of no findings of the court on or before October 28, 2004, that reflect that the court determined that Tierney was entitled to the sums of $115,442.20 and $34,667.72, and that these sums represented, respectively, the “value of Edna Tierney’s assets at the time of her death” and the sum of all funds “improperly” paid to Stacey and the members of her family. Some evidence was received at trial that Stacey had withdrawn funds from Edna Tierney’s bank accounts. During the trial, Tierney’s counsel claimed that Stacey wrote checks to herself and her husband “for more than $26,000.” In fact, checks totaling $26,878 were received in evidence after counsel’s statement about $26,000. We have not found other evidence in the record, and we have been advised of none, that has any relationship to the orders directing the payment of the sums of $115,442.20 and $34,667.72.

During the trial, there was testimony from the attorney, who prepared the 2002 amendment to the trust, that title to the residence at 3923 McNab Avenue was in the Tierney Trust. The September 9, 2005 ex parte order directed appellant Stacey to execute a grant deed transferring this property to respondent Tierney. It is unclear why this order was entered. If title to the property was held by the Tierney Trust, title could not be in either appellant Stacey or respondent Tierney. This potential cloud on the title, i.e., the grant deed from Stacey to Tierney, if it is a cloud on the title, needs to be resolved by the trial court. At a minimum, it must be clarified who holds title to the property.

The second reason why we conclude that a statement of decision should be prepared is that the evidence in this case is relatively extended and nuanced.

Edna Tierney was 85 years old at the time of her death in 2002. She lived alone after her husband died in 1972. Her closest relatives were her son Joseph, who was married to respondent Tierney and appellant Stacey, who was Edna Tierney’s sister. Joseph, who was the sole beneficiary of Edna Tierney’s trust estate, died of cancer in 2001. Prior to Joseph’s death, appellant Stacey was the first contingent beneficiary and respondent Tierney was the second contingent beneficiary. In 2000, with Joseph dying of esophageal cancer, Edna Tierney made respondent Tierney the first contingent beneficiary; respondent Tierney and Joseph lived close to Edna and the expectation was that respondent Tierney would take care of Edna.

Edna Tierney was suffering from congestive heart failure and spent portions of 2001 hospitalized at an acute care, and then a skilled nursing facility. When she returned home, she required home care on a 24 hour basis. Respondent Tierney assisted Edna Tierney during this time, and took over Edna Tierney’s financial affairs after Joseph died in 2001.

Disputes and bad blood began arising between appellant Stacey and respondent Tierney in 2002, when Stacey came to visit Edna Tierney. The disputes centered on respondent Tierney’s handling of Edna’s finances.

Edna expressed some dissatisfaction with respondent Tierney, and remarked to a nursing supervisor in early 2002 that appellant Stacey, her sister, would help her with everything, and that respondent Tierney wasn’t there for her. On February 22, 2002, Edna Tierney called attorney Kenneth Zommick in order to change the beneficiary from respondent Tierney to appellant Stacey.

Zommick testified at trial. Zommick prepared the amendments removing Tierney and substituting Stacey as beneficiary under the trust. He also drafted a pour-over will and durable powers of attorney for healthcare and financial management. Zommick spoke to and met with Edna Tierney three times. The first occasion was when he spoke with her on the telephone, when Edna called him. During that conversation, he obtained basic family information from Edna, who told him that she wanted to exclude respondent Tierney, her two grandchildren and the five great-grandchildren in favor of her sister, appellant Stacey. Zommick found Edna responsive to his questions and was satisfied that Edna knew what she was saying.

Edna met Zommick in his office on March 4, 2002. Appellant Stacey came along, but at one point Zommick asked her to step outside so that he could talk to Edna alone.^[5] Zommick asked Edna if Stacey told her to change the trust. Edna “said, absolutely not. She said, ‘It was my idea, I wanted to do that,’ and I said, ‘Well, why do you want to do that,’ and then she proceeded to tell me why.” In substance, the reason was that while her son Joseph was alive and she was visiting him and his family, the only person to really talk to her was Joseph; the others, including respondent Tierney, really did not talk to her. After Joseph died, she almost never heard from the grandchildren or the great-grandchildren, and rarely heard from respondent Tierney. Edna had some “medical issues” and would call her sister, appellant Stacey, who ended up coming from Cincinnati, Ohio, to take care of her. When asked by counsel whether he thought that Edna had testamentary capacity, Zommick answered: “Did I make that decision [that she had testamentary capacity]? I did. I felt that she knew where she was, she knew who her heirs were, she knew what her assets were, and she had a reasonable plan for the disposition of those assets, so because of those facts I felt she was capable of executing a Will or a Trust, a Trust is a different -- slightly different capacity issue, it’s a contractual capacity, does she knew what she wants to do, and I felt that she did.” Zommick testified that he went over the other documents with Edna, and that she understood the purpose of these documents. Zommick also testified that all of the documents, including the amendment to the Tierney trust, were done at his office and that appellant Stacey had no part in preparing them.

Zommick went to Edna Tierney’s house on March 8, 2002, with the completed documents for Edna’s signatures. Zommick again satisfied himself that Edna knew what she was doing, and that she had not been persuaded or threatened by appellant Stacey. Edna confirmed that she had not been persuaded or threatened in any way.

Appellant Stacey candidly notes in her opening brief that there are facts that favor respondent’s side of this controversy, i.e., facts that are indicative of undue influence. Edna Tierney suffered from memory lapses and was confused about the 19 separate medications she was taking and about her finances; she was increasingly, and substantially, dependent on others to care for her basic needs. Social worker Miller, who had no medical or legal experience, testified that she thought that Edna Tierney was not competent, that she could not discuss her trust competently, and that she was being influenced by appellant Stacey. To some extent, these observations were repeated by nursing manager Delaney.

There are three factors that are weighed to determine whether undue influence has been exercised. One, the relations between the parties are such as to afford the opportunity to control the testamentary act. Two, the decedent’s condition was such as to permit a subversion of the freedom of will. Three, the person allegedly asserting undue influence was active in procuring the instrument to be executed. (Estate of Graves (1927) 202 Cal. 258, 262, cited in 14 Witkin, Summary of Cal. Law (10th ed. 2005) Wills and Probate, § 132, p. 195.)

The trial court found that the first of these requirements was met, in that Edna had a relationship of trust and confidence with her sister, appellant Stacey. The court also found that appellant actively displaced the persons who were taking care of Edna when Stacey arrived from Ohio. The court found that this was done to assert influence over Edna Tierney. The court also found that the checks that had been written to appellant’s family members were indicative of appellant’s intent to control Edna. The court found Edna’s condition to be such as to permit a subversion of the freedom of will, which is the second factor to be considered. The court also found that the third factor was satisfied. The court did not find attorney Zommick to be persuasive because he was not the attorney who prepared the original trust, and he saw Edna only twice in person, and spoke to her once on the telephone.

Given the conflicts in the evidence, we think that the ends of justice would be served if, instead of the court’s extemporaneous remarks, the evidence would be sifted and weighed in a statement of decision. It is also true that the court’s ex parte order of September 9, 2005, has created a situation regarding title to the McNab Avenue property that requires clarification, and that it is the trial court that should provide that clarification in the first instance. In the same vein, if there is support in the record of the October 2004 trial for the payment of the sums of $115,442.20 and $34,667.72, the trial court should make appropriate findings that are supported by substantial evidence.

Finally, rule 232(c) of the California Rules of Court contains a provision that deals with a situation where a statement of decision is requested but no statement of decision is served within the 15 days prescribed for this task. In such an event, any party who appeared at trial may “serve on all other parties and file a notice of motion for an order that a statement of decision be deemed waived.” The presence of this provision suggests that a waiver of a statement of decision, once it has been requested, is not to be lightly implied.

In light of the foregoing, we conclude that a statement of decision was requested but was not prepared and was not waived. This requires a reversal of the judgment, and a remand for the purpose of preparing and filing a statement of decision, and entering a new judgment based on that decision. (Social Service Union v. County of Monterey (1989) 208 Cal.App.3d 676, 681.)^[6]

THE APPEAL FROM THE EX PARTE ORDERS

We have already noted that there appears to be no support in the record of the trial of October 7 and 8, 2004, for the ex parte orders of September 9, 2005 directing the payment of $115,442.20 and $34,667.72 by appellant Stacey to respondent Tierney. Absent such support, it is fundamental that the trial court did not have jurisdiction on September 9, 2005, to enter orders directing the payment of these sums.

The elements of due process in a judicial proceedings are jurisdiction, notice and an opportunity for a hearing. (7 Witkin, Summary of Cal. Law, supra, Constitutional Law, § 640, p. 1041, citing, inter alia, Scott v. McNeal (1894) 154 U.S. 34 and Twining v. New Jersey (1908) 211 U.S. 78, overruled on other grounds in Malloy v. Hogan (1964) 378 U.S. 1, 6.) None of these requirements were met in this case when it comes to the ex parte orders of September 9, 2005, directing the payment of the sums of $115,442.20 and $34,667.72.

Initially, we note that the judgment decreeing void the amendment of March 8, 2002, that named appellant Stacey as trustee did not find that: (1) $115,442.20 was the value of Edna’s estate; that (2) Stacey had appropriated the entire estate of $115,442.20; and that (3) Stacey had “improperly” paid $34,667.72 to herself and members of her family.

We requested Tierney’s counsel to furnish us with the bases, if any, for the awards of $115,442.20 and $34,667.72. In reply, counsel has cited to a letter dated December 30, 2004, in which counsel, among other things, reviewed the state of Edna Tierney’s bank accounts as of the date of her death. In this letter, addressed to Stacey’s counsel, counsel made a demand to settle the matter for $150,109.22, which is the sum of $115,442.20 and $34,667.72, i.e., the monetary awards entered on September 9, 2005. Counsel has also referred us to 43 separate pages reflecting bank accounts, cancelled checks and similar information that was apparently attached to the demand letter of December 30, 2004.^[7] We note that counsel’s reference to this demand letter as the basis for the monetary awards of $115,442.20 and $34,667.72 entered on September 9, 2005, confirms our conclusion that the judgment of March 8, 2002, did not address the matter of a monetary award.

It goes without saying that an assertion that a sum is due does not mean that it is due. Yet, that is all that the letter of December 30, 2004 is: an assertion by counsel that Stacey expended $150,109.22 that belonged to Edna Tierney, i.e., her trust. The proposition that a court cannot award the sum of $150,109.22 (or any sum) without a trial simply because a lawyer demanded $150,109.22 is so fundamental as to require no citation of authority. The award of the sum $150,109.22 is rendered even more extraordinary by the circumstances that it was entered on an ex parte basis, without giving Stacey an opportunity to file a memorandum in opposition to the request.

We conclude that on September 9, 2004, the trial court had no jurisdiction to make the monetary awards of $115,442.20 and $34,667.72, especially ex parte, which deprived respondent of appropriate notice, the opportunity of a hearing and a trial on the merits.

As far as the other three orders are concerned, even apart from the parties agreement to stay the enforcement of the judgment and the ex parte orders, the appeal stayed the judgment, insofar as the judgment removed respondent Stacey as trustee. (Prob. Code, § 1310.)^[8] While the trial court had the power to appoint a temporary trustee (see fn. 8), it should have done so only after appropriate notice was given, and there was an opportunity to be heard. The appointment of a temporary trustee requires a finding, after a hearing, of extraordinary circumstances involving imminent risk of injury or loss. (Gold v. Superior Court (1970) 3 Cal.3d 275, 285.) Although there was an initial showing of injury to the residence on McNab Avenue, there was no hearing on the matter.

If the judgment was intended to have affected title to the property on McNab Avenue, the appeal also stayed the judgment regarding this matter. In any event, it does not appear that the judgment did, or was intended to, affect the title to the property, which was held by the Tierney Trust. We have already pointed out that the trial court must take action to eliminate the confusion, and possible cloud on title, that the ex parte order of September 9, 2005, may have created.

For the reasons indicated, all of the ex parte orders of September 9, 2005, are vacated and set aside.

APPELLANT’S REQUEST FOR SANCTIONS IS DENIED

Appellant requests sanctions for three reasons. First, appellant claims that respondent has referred to trial exhibits that were marked but were not received in evidence at trial. Second, appellant states that her counsel has had to expend time and effort to respond to the baseless charge that appellant has failed to comply with the trial court’s orders. Third, appellant contends that her counsel has had to expend time to respond to factual arguments that are misleading and that, importantly, are not supported by references to the record.

Each of these points is well taken. We have, however, disregarded on our own motion matters that are not properly part of the record and matters asserted in the respondent’s brief that are not supported by references to the record. “Statements of facts not supported by references to the record may be disregarded as a violation of rule 14(a)(1)(C) of the California Rules of Court.” (Yeboah v. Progeny Ventures, Inc. (2005) 128 Cal.App.4th 443, 451.) We have also been made aware of the fact that the parties have agreed to a stay of the enforcement of the judgment and the ex parte orders and therefore give no credence to the claim that appellant has failed to comply with the court’s orders. We conclude that, while these missteps by respondent are regrettable, an award of monetary sanctions is not warranted.

DISPOSITION

The judgment is reversed and remanded with directions to prepare a statement of decision, and to enter a new judgment based on that statement of decision. The orders of September 9, 2005, are vacated and set aside. Appellant is to recover her costs on appeal.NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

FLIER, J.

We concur:

COOPER, P. J.

RUBIN, J.

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^[1] The trial that concluded with the judgment of October 28, 2004, was before the Hon. Roy Paul.

^[2] 7 Witkin, California Procedure (4th ed. 1997) Trial, § 404, page 465.

^[3] The parties may agree to an oral statement of decision, and when the trial is less than eight hours long, the statement of decision may be made orally on the record in the presence of the parties. (§ 632.)

^[4] “This is a ruling that is obviously subject to the completion of the Statement of Decision, and the court has the right to in fact, and has the obligation to correct any factual findings that I may have made that may be inaccurate once that’s prepared by the plaintiff.” This suggests that the court viewed its tentative decision to be subject to revision in the statement of decision, i.e., the court expected that a statement of decision would be prepared.

^[5] “I [Zommick] decided that I wanted to find out if somebody was pushing her to make this decision, so I asked Marie [Stacey] to step out of the office, and she stepped into the waiting room. Then I proceeded to ask Edna if someone was taking advantage of her.”

^[6] We find the statement of the court in Social Service Union v. County of Monterey, supra, 208 Cal.App.3d at page 681 to be an apt description of the situation in this case:

“A statement of decision which adequately explained the factual and legal basis for the trial court’s decision on the controverted issues would put this case in a more appropriate posture for appellate review and would materially aid this court’s consideration of the issues on appeal.”

^[7] We observe in the margin that the ostensibly supporting documents are presented in a helter-skelter fashion, making it impossible to readily determine how counsel arrived at the sums of 115,442.20 and $34,667.72.

^[8] Probate Code section 1310 provides in relevant part: “(a) Except as provided in subdivisions (b), (c), (d), and (e), an appeal pursuant to Chapter 1 (commencing with Section 1300) stays the operation and effect of the judgment or order. (b) Notwithstanding that an appeal is taken from the judgment or order, for the purpose of preventing injury or loss to a person or property, the trial court may direct the exercise of the powers of the fiduciary, or may appoint a temporary guardian or conservator of the person or estate, or both, or special administrator, to exercise the powers, from time to time, as if no appeal were pending. All acts of the fiduciary pursuant to the directions of the court made under this subdivision are valid, irrespective of the result of the appeal.”