Susan Smyth, et al., v. Mullen & Henzell L.L.P.

Case Number

22CV03893

Case Type

Hearing Date / Time

Tue, 10/17/2023 - 10:00

Nature of Proceedings

Motion of Defendant for Summary Judgment as to Plaintiff Susan Smyth

Tentative Ruling

For Plaintiffs Susan Smyth, Pedro Baltadano, Martin Engriser, and Don McIntyre:

Louis Pacella, Stephen L. Cohen, The Pacella Law Group                              

For Defendant Mullen & Henzell L.L.P.: Jeffrey A. Charlston, Robert D. Hoffman,

Charlston, Revich, Harris & Hoffman LLP

                     

              

RULING:

For the reasons set forth herein, the motion of Defendant Mullen & Henzell L.L.P. for summary judgment is denied.

Background

On October 6, 2022, Plaintiffs Susan Smyth (Smyth), Pedro Baltadano (Baltadano), Martin Engriser (Engriser), and Don McIntyre (McIntyre) (collectively, Plaintiffs) filed their original complaint in this action asserting one cause of action for intentional interference with expected inheritance (IIEI claim).

On January 11, 2023, Plaintiffs filed their operative pleading, their first amended complaint (FAC), asserting the same cause of action against Defendant Mullen & Henzell L.L.P. (Defendant or M&H) only.

As alleged in the FAC:

Plaintiffs were close friends of Edward J. Charvet, Jr. (decedent). (FAC, ¶ 15.) Decedent spent nearly all his time with Plaintiffs and repeatedly told Plaintiffs he wished for them to inherit his estate. (Id. at ¶¶ 14, 15.) Decedent died on August 22, 2021. (Id. at ¶ 10.) At his death, decedent was “unmarried [,] had one (1) child … who was adopted out as a child and with whom decedent had no relationship [,] had no siblings, living or deceased, and had no blood-line family with whom he had a relationship or that he was even aware existed.” (Id. at ¶ 14.)

While decedent was alive and after discovering that decedent was the target of attempted elder abuse, Smyth made an appointment with Jana S. Johnston (Johnston) who is a partner in Defendant’s law firm. (FAC, ¶¶ 9, 16, 17.) Johnston consulted with Smyth and decedent in June 2014. (Id. at ¶ 18.) During the consultation, Johnston recommended the creation of a trust. (Id. at ¶ 19.) Decedent informed Johnston that he did not know who his heirs were and did not know the name of his son who was given up for adoption as a child. (Ibid.) When asked to whom he wanted to leave his assets, decedent told Johnston that he wanted to leave his assets to his friends who decedent identified as Plaintiffs. (Ibid.) Johnston acknowledged decedent’s desire to name his friends as the beneficiaries of the trust. (Ibid.) Johnston recommended Sharon C. Kennedy of Sharon Kennedy Estate Management (Kennedy) as a professional fiduciary to oversee the trust. (Ibid.) Decedent agreed to name Kennedy as the trustee of the trust.

On June 13, 2014, Johnston emailed Smyth regarding the status of the drafting of trust, stating that “[t]he trust is not a simple or standard agreement in that we are drafting special provisions specifically to address [decedent’s] wishes, preferences, and unique circumstances.” (FAC, ¶ 21 & exhibit B.) On July 2, 2014, Smyth drove decedent to Defendant’s offices to meet with Johnston for the purpose of signing the trust. (Id. at ¶ 23.) The Edward Charvet, Jr. Revocable Trust (the revocable trust) was executed by decedent on July 2, 2014. (Id. at ¶¶ 10, 23 & exhibit A.) Kennedy is named as the trustee of the revocable trust. (Id. at ¶ 10 & exhibit A.) Concurrent with the signing of the revocable trust, decedent executed a pour-over will prepared by Defendant and naming the revocable trust as its residual beneficiary. (Id. at ¶¶ 25, 27 & exhibit D.) Decedent also executed grant deeds transferring title to properties located in Santa Barbara and Ventura County to the revocable trust. (Id. at ¶ 24 & exhibits C-1 through C-4.)

The revocable trust is a standard trust that leaves all assets to decedent’s “heirs”. (FAC, ¶ 22.) The only modification to a traditional revocable living trust is language specifically disinheriting decedent’s biological son. (Ibid.) The will executed by decedent makes no reference to the general testamentary power of appointment referenced in section 5.2.3 of the revocable trust. (Id. at ¶ 27.) Plaintiffs have not discovered any other will executed by decedent that exercised the testamentary power of appointment referenced in section 5.2.3 of the revocable trust. (Id. at ¶ 28.) Plaintiffs believe that Johnston’s June 13, 2014, email referencing special provisions to address decedent’s unique circumstances were designed to deceive decedent, through Smyth, as to the identity of the named beneficiaries of the revocable trust. (Id. at ¶¶ 22, 44.) Johnston drafted the revocable trust in contravention to decedent’s intent with the goal of deriving an improper benefit from decedent’s estate in the form of a deprivation of Plaintiff’s expectation of an inheritance due to internal perceptions of them, which they otherwise would have received. (Id. at ¶ 47.) Had Defendant prepared the revocable trust in a manner consistent with decedent’s wishes, there is a reasonable certainty that Plaintiffs would have received the inheritance they were promised and expected. (Id. at ¶ 48.)

On February 21, 2023, Defendant filed its demurrer and motion to strike as to the FAC. Defendant argued that the IIEI claim was barred by the one-year statute of limitations of Code of Civil Procedure section 366.3, and otherwise failed to allege facts sufficient to state that claim.

On March 22, 2023, the Court overruled the demurrer and denied the motion to strike.

On April 5, 2023, Defendant filed its answer to the complaint generally denying the allegations thereof and asserting 19 affirmative defenses.

On August 4, 2023, Defendant filed this motion for summary judgment, as to the claim asserted by Plaintiff Smyth only, on the grounds that Smyth’s action is barred by the statute of limitations set forth in Code of Civil Procedure section 340.6.

The motion is opposed by Plaintiffs.

Analysis

“A party may move for summary judgment in an action or proceeding if it is contended that the action has no merit or that there is no defense to the action or proceeding.” (Code Civ. Proc., § 437c, subd. (a)(1).)

“A Defendant … has met his or her burden of showing that a cause of action has no merit if the party has shown that one or more elements of the cause of action, even if not separately pleaded, cannot be established, or that there is a complete defense to the cause of action. Once the Defendant … has met that burden, the burden shifts to the Plaintiff … to show that a triable issue of one or more material facts exists as to the cause of action or a defense thereto. The Plaintiff … shall not rely upon the allegations or denials of its pleadings to show that a triable issue of material fact exists but, instead, shall set forth the specific facts showing that a triable issue of material fact exists as to the cause of action or a defense thereto.” (Code Civ. Proc., § 437c, subd. (p)(2).)

“But other principles guide us as well, including that ‘[w]e accept as true the facts … in the evidence of the party opposing summary judgment and the reasonable inferences that can be drawn from them.’ [Citation.] And we must ‘“view the evidence in the light most favorable to Plaintiff [] …’ and “liberally construe Plaintiff[’s] evidentiary submissions and strictly scrutinize Defendant[’s] own evidence, in order to resolve any evidentiary doubts or ambiguities in Plaintiff[’s] favor.”’ [Citation.]” (Nazir v. United Airlines, Inc. (2009) 178 Cal.App.4th 243, 254.)

Whether or not Defendant has met its initial burden on summary judgment, there are triable issues of fact that preclude granting this motion. As one example:

Defendant’s separate statement fact 12 is: “Charvet expressly instructed M&H that

no portion of his estate was to be left to [a child of decedent] but did not reach a decision as to who to designate as beneficiaries of the Trust and Charvet rejected the option of designating close friends or charities as beneficiaries of the Trust.” In support of this fact, Defendant cite to the declarations of attorneys Stephen N. Yungling and Jana S. Johnston.

In the cited paragraph of Johnston’s declaration, attorney Johnston declares: “At no time during any of the above calls and meetings I had with Charvet did Charvet ever express to me or imply that he desired or intended to name any of his ‘friends’ as beneficiaries of his estate or trust. At no point in my communications with him did he ever identify who he wanted to be beneficiaries of his estate or Trust upon his passing.” (Johnston decl., ¶ 12.) In paragraph 11 of that same declaration, Johnston identifies as one of the meetings as: “I met personally with Charvet and Smyth on June 10, 2014.” (Johnston decl., ¶ 11(m).)

In her declaration, Smyth declares: “On June 10, 2014, I attended a meeting at M&H with Ed. The purpose of the meeting was to decide what would go into the trust. The meeting was somewhere between one (1) and two (2) hours. We were sitting at a conference room table with Ed and Johnston sitting at the corner end and I in the middle. For the first time, there was a discussion about beneficiaries. I had had no discussions with Ed about his beneficiaries. Johnston asked Ed who he wanted to be his beneficiaries. Ed was hesitant at first. Johnston asked him about his son because he was ‘his blood.’ Ed said ‘no’ and that he didn’t want the child to be his beneficiary. Johnston told him if he didn’t want his assets to go to his son, then everything would go to his ‘next of kin.’ Emphatically, Ed said ‘No!’ and wrinkled his nose and said, ‘I don’t even know them, they have never helped me.’ Johnston asked that if he didn’t want his next of kin to be his beneficiaries, who did he want it to be? He said, ‘My friends.’ He pointed to me and then mentioned Martin, Don and Pedro saying, ‘they are my family, they are the ones who help me.’ ” (Smyth decl., ¶ 24.)

In reply, Defendant objects to paragraph 24 of the Smyth declaration as hearsay. The objection (No. 10) is overruled. The declaration testimony is either not hearsay because decedent’s statement consists of operative facts regarding instructions to counsel (see Jazayeri v. Mao (2009) 174 Cal.App.4th 301, 316) or, among other possible hearsay exceptions, is within the rule of completeness based upon Johnston’s testimony about the contents of the June 10, 2014, conversation (see Evid. Code, § 356). (Note: The Court does not rule on the remaining evidentiary objections as unnecessary to the disposition of this motion. (See Code Civ. Proc., § 437c, subd. (q).)

Smyth’s declaration thus directly disputes separate statement fact 12.

“ ‘[T]he separate statement effectively concedes the materiality of whatever facts are included. Thus, if a triable issue is raised as to any of the facts in your separate statement, the motion must be denied!’ ” (Nazir v. United Airlines, Inc., supra, 178 Cal.App.4th at p. 252, quoting Weil & Brown, Cal. Practice Guide: Civil Procedure Before Trial (The Rutter Group 2009) ¶ 10:95.1, p. 10-35 (rev. # 1, 2009).)

The motion for summary judgment will therefore be denied.