Beneficiaries - Trustees And Beneficiaries - Probate - CA

Section § 15800

This law explains how a revocable trust is managed and who has rights when the person who created the trust (the settlor) may not be competent or able to manage it. As long as the person who can revoke the trust is competent, they have the rights of a beneficiary, and the trustee owes duties to them. If that person becomes incompetent, the trustee must notify relevant beneficiaries within 60 days and provide a copy of the trust. The trustee's duties then shift to those beneficiaries who would inherit if the settlor were deceased. If a beneficiary's interest depends on a condition not yet met, they don't count unless it's likely they'll meet the condition by the settlor's death. Incompetency can be determined by the trust's guidance or a court decision.

(a) Except to the extent that the trust instrument otherwise provides or where the joint action of the settlor and all beneficiaries is required, during the time that a trust is revocable and at least one person holding the power to revoke the trust, in whole or in part, is competent, the following shall apply:

(1) The person holding the power to revoke, and not the beneficiary, has the rights afforded beneficiaries under this division.

(2) The duties of the trustee are owed to the person holding the power to revoke.

(b) Except to the extent that the trust instrument otherwise provides or where the joint action of the settlor and all beneficiaries is required, if, during the time that a trust is revocable, no person holding the power to revoke the trust, in whole or in part, is competent, the following shall apply:

(1) Within 60 days of receiving information establishing the incompetency of the last person holding the power to revoke the trust, the trustee shall provide notice of the application of this subdivision and a true and complete copy of the trust instrument and any amendments to each beneficiary to whom the trustee would be required or authorized to distribute income or principal if the settlor had died as of the date of receipt of the information. If the trust has been completely restated, the trustee need not include the trust instrument or amendments superseded by the last restatement.

(2) The duties of the trustee to account at least annually or provide information requested under Section 16061 shall be owed to each beneficiary to whom the trustee would be required or authorized to distribute income or principal if the settlor had died during the account period or the period relating to the administration of the trust relevant to the report, as applicable.

(3) A beneficiary whose interest is conditional on some factor not yet in existence or not yet determinable shall not be considered a beneficiary for purposes of this section, unless the trustee, in the trustee’s discretion, believes it is likely that the condition or conditions will be satisfied at the time of the settlor’s death.

(4) If the interest of a beneficiary fails because a condition to receiving that interest has not been satisfied or the trustee does not believe that the condition will be satisfied at the time of the settlor’s death, the duties in paragraphs (1) and (2) shall be owed to the beneficiary or beneficiaries who would next succeed to that interest at the relevant time or period as determined under the trust instrument, as amended and restated.

(1) The method for determining incompetency specified by the trust instrument, as amended or restated.

(2) A judicial determination of incompetency.

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Section § 15801

This section explains that when a trust can still be revoked and the person who can revoke it is mentally capable, that person, not the beneficiary, has the authority to approve or deny certain actions related to the trust. However, if the law requires both the person who created the trust and all beneficiaries to agree, this rule doesn’t apply.

(a) In any case where the consent of a beneficiary may be given or is required to be given before an action may be taken, during the time that a trust is revocable and the person holding the power to revoke the trust is competent, the person holding the power to revoke, and not the beneficiary, has the power to consent or withhold consent.

(b) This section does not apply where the joint consent of the settlor and all beneficiaries is required by statute.

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Section § 15802

If a trust can be canceled and the person who can do so is mentally capable, any notices meant for the beneficiaries of the trust should be directed to that person instead of the beneficiaries.

Notwithstanding any other statute, during the time that a trust is revocable and the person holding the power to revoke the trust is competent, a notice that is to be given to a beneficiary shall be given to the person holding the power to revoke and not to the beneficiary.

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Section § 15803

If you have the right to take property out of a trust or change who gets the trust property (called a 'general power of appointment'), you have the same rights as someone who can completely undo the trust, as per certain other rules. However, these rights only apply to the part of the trust you can control.

The holder of a presently exercisable general power of appointment or power to withdraw property from the trust has the rights of a person holding the power to revoke the trust that are provided by Sections 15800 to 15802, inclusive, to the extent of the holder’s power over the trust property.

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Section § 15804

This law explains how to properly give notice to beneficiaries or interested parties in trust-related matters. If a person's share in a trust is contingent on future events, notice should be given as if those events have already happened before proceedings start. It also ensures that if there's a conflict of interest, all relevant parties get notified, even if they're not originally required to receive notice. Additionally, this law doesn't change any specific requirements for special notifications that may be requested or legally required, like those needing a guardian ad litem.

(a) Subject to subdivisions (b) and (c), it is sufficient compliance with a requirement in this division that notice be given to a beneficiary, or to a person interested in the trust, if notice is given as follows:

(1) Where an interest has been limited on any future contingency to persons who will compose a certain class upon the happening of a certain event without further limitation, notice shall be given to the persons in being who would constitute the class if the event had happened immediately before the commencement of the proceeding or if there is no proceeding, if the event had happened immediately before notice is given.

(2) Where an interest has been limited to a living person and the same interest, or a share therein, has been further limited upon the happening of a future event to the surviving spouse or to persons who are or may be the distributees, heirs, issue, or other kindred of the living person, notice shall be given to the living person.

(3) Where an interest has been limited upon the happening of any future event to a person, or a class of persons, or both, and the interest, or a share of the interest, has been further limited upon the happening of an additional future event to another person, or a class of persons, or both, notice shall be given to the person or persons in being who would take the interest upon the happening of the first of these events.

(b) If a conflict of interest involving the subject matter of the trust proceeding exists between a person to whom notice is required to be given and a person to whom notice is not otherwise required to be given under subdivision (a), notice shall also be given to persons not otherwise entitled to notice under subdivision (a) with respect to whom the conflict of interest exists.

(1) Requirements for notice to a person who has requested special notice, a person who has filed notice of appearance, or a particular person or entity required by statute to be given notice.

(2) Availability of a guardian ad litem pursuant to Section 1003.

(d) As used in this section, “notice” includes other papers.

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Section § 15805

This law says that the Attorney General must follow the same rules and limitations as other beneficiaries when it comes to revocable trusts, according to Sections 15800 to 15802.

Notwithstanding any other provision of law, the Attorney General is subject to the limitations on the rights of beneficiaries of revocable trusts provided by Sections 15800 to 15802, inclusive.

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