Matter of Henry and Venice Dettamanti Family Trust
Matter of Henry and Venice Dettamanti Family Trust
Case Number
23PR00280
Case Type
Hearing Date / Time
Wed, 05/22/2024 - 09:30
Nature of Proceedings
Hearing & Petition for Instructions
Tentative Ruling
For Petitioner and Trustee Elizabeth Watkins: Aaron Feldman
For Associated Trust Party: Mark Herrick
For Objector Christina Carrari and Linda Kopcrak: Tiffany Carrari
For Objector Mario Dettamanti: Katherine Dettamanti
RULINGS AND ORDERS OF THE COURT
For the reasons set out below the Court orders:
1. The Trust consists of the following assets:
4465 La Tierra Lane, Carpentaria – value $1,300,000.00 – date 11/1/23.
3118 Pellham Drive, Lompoc - value $775,000.00 - date 3/1/2023.
Well Lot, Lompoc Corp – value $42,500.00 – date 5/5/2023.
Cash on Hand – value $1,549,041.63 – date 5/19/2023.
Distributions - 75,000.00.
Total - $3,754,041.63
2. The Trustee’s proposal to withhold $100,000 from immediate distribution to address pending and anticipated litigation, leaving $3,654,041.63 for immediate distribution is approved.
3. Trustee alleges there is a preliminary injunction entered preventing distributions of Angelina Dettamanti’s share of the Trust [to wit: Angelina Dettamanti (25%) = $913,510.41].
4. Trustee’s proposal to make Initial Distributions to the other beneficiaries of the Trust is approved as follows:
A. To Mario Dettamanti: cash in the amount of $838.510.41. This is in addition to the $75,000 preliminary distribution received by Mario in March 2023.
B. To Trustee: The house in Carpinteria; the Lompoc Warehouse shares and $484,520.81 in cash [less the surcharge listed below in para #5].
5. The Trustee is surcharged $6,000 per month for living rent-free in the Carpinteria House for the period of March 24, 2021, to the date of distribution. A decision on the distribution of that money is reserved until the date of the Final Distribution.
6. The Objectors’ request for attorney’s fees and costs is denied.
7. The Objectors’ request that Trustee should not be awarded any attorney’s fees and costs is denied.
8. The Objectors’ request that the Trustee be surcharged for the cost of the accounting and denied any compensation to date is denied.
9. The Objector’s claim that the Trustee must clarify the following remaining two issues in the amended accounting is denied without prejudice; they may be raised again at the date of the Final Accounting; to wit:
A. What are the terms of the “loan” used to pay the Trustee’s restitution to the Ventura County District Attorney’s Office?
B. Where are the missing Coasthills bank account funds?
10. The Objector’s request that any response by the Trustee was waived because she failed to timely respond to objections is denied. The Court has ruled on all the Objections raised below.
11. Since the Court has made the foregoing orders, the remaining issue for the Trust is the sale of the Pellham property and a Final Account and Distribution.
12. The Final Account and Distribution Date is set for 11/20/24 at 9:30am in this Department.
13. This will be the Order of the Court. A further written order is not required.
Analysis
Petition for Instructions
This case was filed by the Attorney for the Successor Trustee Elizabeth Watkins by her attorney Aaron Feldman on 5/30/23; hearing set for 8/31/23; 53 pages; summarized; on February 6, 1986, Henry Dettamanti and Venice Dettamanti created The Henry and Venice Dettamanti Family Trust. As was customary at the time, the Trust was formulated as an A/B Trust. The Trust was amended twice during Henry Dettamanti’s lifetime. The First and Second Amendments were attached as Exhibits “B” and “C” respectively.
Henry Dettamanti died in 2002. From 2002 until October 25, 2021, Venice Dettamanti was the sole Trustee and surviving Settlor of the TRUST.
On March 29, 2007, Venice Dettamanti attempted to create a Third Trust Amendment1 (attached as Exhibit “D”); however, following the death of her husband, Trust B was an irrevocable Trust that could not be amended. The sole purpose of the Third Amendment dealt with the real property commonly known as 529 N. 7 th Street, Lompoc CA. That asset was part of the irrevocable trust and thus the Third Amendment is moot. That asset was sold and is no longer a trust asset.
The Settlors had two children, Petitioner Elizabeth Watkins and a son Benjamin Dettamanti. They were also the two equal beneficiaries of the Trust. Benjamin Dettamanti predeceased his mother, dying on August 20, 2021. As a result of his death, his two children became equal beneficiaries of the Trust as to their father’s 50% share. Venice Dettamanti died on July 25, 2022.
On October 25, 2021, Elizabeth Watkins took over as Trustee for her mother for both the Survivor’s Trust and the By-pass Trust.
The Trust consists of the following assets:
4465 La Tierra Lane, Carpentaria – value $1,300,000.00 – date 11/1/23.
3118 Pellham Drive, Lompoc - value $775,000.00 date 3/1/2023.
Well Lot, Lompoc Corp – value $42,500.00 – date 5/5/2023.
Cash on Hand – value $1,549,041.63 – date 5/19/2023.
Distributions - 75,000.00.
Total - $3,754,041.63
The Trustee is proposing withholding $100,000 from immediate distribution to address pending and anticipated litigation, leaving $3,654,041.63 for immediate distribution.
The current beneficiaries of the Trust and the amounts of proposed distributions are as follows:
Elizabeth Watkins (50%) - $1,827,020.81
Angelina Dettamanti (25%) - $913,510.41
Mario Dettamanti (25 % minus $75,000 preliminary distribution) $838,510.41
Total $3,654,041.63
On February 27, 2023, Linda Kopcrak, Christina Carrari and Linda Kopcrak filed a Petition to enforce a money judgment against Angelina Dettamanti. Petitioner filed a response to said Petition on April 3, 2023. Petitioner, as Trustee, was not a party to the litigation resulting in the judgments against Angelina Dettamanti. (Case #20CV00305). [On 9/8/23 Judge Jed Beebe granted a Motion for Attorney’s Fees filed by Defendants.]
Trustee’s lawyer reports there is a preliminary injunction entered preventing distributions of Angelina Dettamanti’s share of the Trust;[1] however, Petitioner as Trustee desires to make distributions to the other beneficiaries of the Trust as follows:
A. To Mario Dettamanti: cash in the amount of $838.510.41. This is in addition to the $75,000 preliminary distribution received by Mario in March 2023.
B. To Elizabeth Watkins: The house in Carpinteria; the Lompoc Warehouse shares and $484,520.81 in cash.
Trustee reports that the Carpinteria property was purchased by Henry and Venice Dettamanti specifically for Elizabeth Watkins and she has lived there for 20 years. An in-kind distribution for this asset to Petitioner makes sense and is 100% consistent with the Settlors’ wishes. The Lompoc Warehouse Corporation is a closely held corporation. The shares are not easily sold and therefore, Petitioner is willing to take these also in-kind as part of her distribution for the purpose of making the remaining Trust administration simpler.
The Trust would be left with the remaining assets: The real property in Lompoc and cash in the amount of approximately $132,261.00.
Angelina has been living in the Lompoc property.
Another purpose of making distributions at this time is to avoid depletion of trust resources related to the litigation surrounding Angelina Dettamanti which is outside the scope of the Trust.
The current Trustee (Petitioner) administers the Trust in Santa Barbara County, California. The principal place of trust administration is 4465 La Tierra Lane, Carpinteria, CA. Under the Probate Code, this is the proper County for an action concerning the Trust.
Hearing on 8/30/23
Subsequently a CCP section 170.3 challenge was made against this Court Officer. Because the 170.3 challenge was only delivered to the Court on Monday 8/28/23 there was no tentative ruling on this matter for 8/30/23; the matter was continued to 11/29/23.
Objections Filed Thereafter
Beneficiary and Objector Angelina Dettamanti; filed objections on 9/6/23; 56 pages; were read and considered.
Objection of Mario H. Dettamanti; Filed 10/9/23; were read and considered.
Hearing on 11/28/23
The Court made the following ruling:
1. This matter was continued to 2/21/24 at 9:30am
2. The Petition for Instructions requested by Petitioner is Granted as follows: Petitioner is ordered to:
A. Submit a “formal accounting” pursuant to Probate Code section 16063, subdivision (a) for the period of 3/24/21 to 1/31/24 of the Henry and Venice Dettamanti Family Trust dated February 6, 1986 (the “Dettamanti Trust”) for approval by this Court on 2/14/24 at 9:30am.
B. Submit a “plan for final distributions” from the Dettamanti Trust for approval by this Court on 2/21/24 at 9:30 am; and
C. The “formal accounting” and the “plan for final distributions” shall be filed and served by Petitioner no later than 1/31/24 at noon.
2. All other requests have been considered and denied without prejudice; they may be raised again between 1/31/23 and 2/7/24 [must be served and filed in that time frame].
The Court wrote an extensive analysis.
First Account & Report
Filed 2/8/24 by the Trustee Elizbeth Watkins; 88 pages; summarized; Petitioner requested that:
1. The Court finds that notice of hearing has been given as required by law.
2. This Court makes an order approving, allowing, and settling the attached account and
report of the Henry and Venice Dettamanti Family Trust u/a date February 6, 1986, as filed.
3. For such other relief that the Court deems proper.
Proposed Distribution Plan. It was filed separately.
Opposition filed by Mario Dettamanti
Filed 2/14/24; Mario, the beneficiary of the Dettamanti Family Trust dated February 6, 1986 (“Trust”), objected to the Petition to Approve Accounting and to the Proposed
Distribution Plan and Request for Approval of Immediate Substantial Distribution from the Trust filed by successor trustee and beneficiary Elizabeth Watkins (“Trustee”); among other things made 22 objections and requested that the Court:
1. Deny the Trustee’s Proposed Distribution Plan and Request for Approval of
Immediate Substantial Distribution from the Trust.
2. Deny the Trustee’s Petition to Approve Accounting.
3. The Trustee shall file an accurate and complete accounting pursuant to Probate Code
section 16063, subdivision (a) for the period of March 1, 2021, to the date of filing for approval by this Court within sixty (60) days.
4. The Trustee shall produce to the beneficiaries complete account statements for the
period of March 1, 2021, to the date of production for each account titled in the name of the Trust or in the name of Venice and/or Henry Dettamanti that currently exist or did exist during the production period.
5. The Trustee shall personally pay the costs of the accounting in the form of a surcharge under Probate Code section 16420, subdivision (a)(3).
6. The Trustee is denied any trustee fees to date.
7. The Trustee be surcharged $6,000 per month for living rent-free in the Carpinteria House for the period of March 24, 2021 to the date of final distribution.
8. Attorney’s fees and costs; and
9. Any other relief the Court deems just and proper.
Opposition filed by Tiffany Carrari
Filed 2/15/24; 8 pages; summarized; in response to Watkins Proposed Distribution Plan and Request for Approval of Immediate Substantial Distribution from the Trust, after conferring with both Watkins and Mario, Linda Kopcrak and Christina Carrari, Co-Trustees, ask that this Court make the following orders:
1. Approve Watkins’ request to make immediate cash distributions of $600,000 to each
of Mario and Respondent.
2. Approve Watkins’ request to make an in-kind distribution of real property 4465 La
Tierra Lane, Carpinteria (the “Carpinteria Residence”) to Watkins.
3. Approve Watkins’ request to reserve the issues of rent and compensation for
determination at the time of final distribution, after the sale of 3118 Pellham Drive,
Lompoc (the “Lompoc Property”).
4. Continue the hearing on Watkins’ Petition to Approve Accounting and order Watkins
to address deficiencies in the Accounting as raised by Mario in his Objection to Petition
to Approve Accounting; and
5. Order Watkins to refrain from making any further distributions until such time as this
Court approves Watkins’ Accounting and rules on any issues reserved for
determination at the time of final distribution, after the sale of Lompoc Property.
Supported by a Memorandum of Points and Authorities; summarized; as it relates to Watkins’ Accounting and Plan for Final Distributions, Respondent is seeking to find common ground with both Watkins and Mario. To that end, Respondent believes that this Court should order the Initial Distribution but hold off on approval of Watkins’ Accounting until the deficiencies raised by Mario have been properly addressed.
Supported by the Declaration of Tiffany Carrari; 18 pages; read ad considered.
Reply By Mario Dettamanti
Filed 4/17/24; 6 pages; summarized; Mario [via his attorney Katherine Dettamanti] requests the Court make the following orders:
1. Deem any response by the Trustee to the Objections filed by Objector Mario H. Dettamanti as waived.
2. Sustain the Objections filed by Objector Mario H. Dettamanti and affirm the facts stated therein.
3. Deny the Trustee’s Proposed Distribution Plan and Request for Approval of Immediate Substantial Distribution from the Trust.
4. Deny the Trustee’s Petition to Approve Accounting.
5. The Trustee shall file an accurate and complete accounting pursuant to Probate Code section 16063, subdivision (a) for the period of March 1, 2021, to the date of filing for approval by this Court within sixty (60) days.
6. The Trustee shall produce to the beneficiaries complete account statements for the period of March 1, 2021 to the date of production for each account titled in the name of the Trust or in the name of Venice and/or Henry Dettamanti that currently exist or did exist during the production period.
7. The Trustee shall personally pay the costs of the accounting in the form of a surcharge under Probate Code section 16420, subdivision (a)(3).
8. The Trustee is denied any trustee fees to date.
9. The Trustee be surcharged $6,000 per month for living rent-free in the Carpinteria House for the period of March 24, 2021, to the date of final distribution;
10. Attorney’s fees and costs; and any other relief the Court deems just and proper.
In support of his requests and in support of his objection to Petition to approve accounting and to the proposed distribution plan he points out that despite 55 days to do so, the Trustee failed to respond to objections to the Petition to Approve Accounting and to the Proposed Distribution Plan and Request for Approval of Immediate Substantial Distribution from the Trust. Objector and beneficiary, Mario H. Dettamanti, requests the Court deem the Trustee’s response waived and the Objections he filed affirmed. In support of his reply to sustain his objections, Mario alleges that on November 29, 2023, the Court ordered Petitioner and Trustee, Elizabeth A. Watkins, (“Trustee”) produce an accounting pursuant to Probate Code Section 16063, subdivision (a) for the Ex Parte for period of March 24, 2021 to January 31, 2024 for approval by the Court on February 14, 2024 at
9:30 am. On February 7, 2024, the Trustee produced a woefully inaccurate and incomplete accounting, to which all parties objected. On February 21, 2024, the Court granted a 55-day continuance for the Trustee to respond to the objections as the Trustee’s attorney was unable to respond as he had been busy attending a birthday party out of town. The Trustee’s attorney agreed to the deadline proposed by the Court to file a response by April 10, 2024 at noon. The Trustee failed to file and serve a response by the deadline. Instead, the Trustee’s counsel noticed an ex parte application to be heard on April 18, 2024—the day after the objectors’ replies are due—to request a further 30-day continuance.
Contends the
1. The Court should deem any response by the Trustee as waived because she failed to timely respond to objections.
2. If the Court deems the Trustee’s response waived, the following objections by Objector and beneficiary Mario H. Dettamanti should be sustained and the facts therein affirmed: Lists Objection ## 1 through 22.
Mario renews his request that the Court order the Trustee be surcharged for the cost of the accounting and denied any compensation to date due to the issues stated and renews his request that the Trustee be surcharged $6,000 per month for living rent-free in the Trust property located at 4465 La Tierra Lane from March 1, 2021 to the date of distribution of that property due to the Trustee’s self-dealing. (Prob. Code § 16004, subd. (a); requests attorney’s fees and costs that he has incurred in the preparation of his Objection and reply in support of the objection due to the Trustee’s failure to supply a complete and accurate accounting, as well as for the fees and costs incurred in his opposition to the ex parte application to continue this matter 30-days to permit the Trustee to file an already late response.
Continuance
On 4/18/2024 via an ex parte motion the Trustee, via her attorney Aaron Feldman, requested that the Court continue the hearing presently set for April 24, 2024, to a date on or after May 20, 2024
and that the response be filed no later than May 10, 2024. Objections were filed by Mario H. Dettamanti and Katherine R. Dettamanti. But the request for a continuance was granted. The April 24, 2024, matter was continued to May 22, 2024; the response to be filed no later than May 10, 2024; the Court denied the relief sought by Mario H. Dettamanti or by Katherine R. Dettamanti, without prejudice.
Supplement to First Account & Report of Trustee and Response to Objections
Filed by Aaron Feldman on behalf of Trustee on 5/10/2024; 224 pages; summarized; contends that if the preliminary distributions are approved as requested, then the remaining issue for the Trust is the sale of the Pellham property and a final account and distribution. Reaches the following conclusion: The accounting, as revised, is substantially complete, true, and accurate. See Exhibit Q which was attached. Petitioner requests that the accounting be accepted. Petitioner does not believe there is any basis to surcharge Petitioner for the cost of the accounting. Accountings for Court are complex and this Trust, having multiple accounts and assets, is more complex than most. The petitioner requests the Court make a ruling on the issue of rental surcharge, if any, and simultaneously the issue of distribution of the house, should rent be assessed. However, if the Court deems the issue premature, then if rent, trustee fees and other issues remain in dispute, the Court should issue a Breslin order and order the parties to mediation. If the preliminary distributions are approved as requested, then the remaining issue for the trust is the sale of the Pellham property and a final account and distribution.
In his report that is verified by Elizabeth Watkins she testifies that Elizabeth Watkins as Successor Trustee of The Henry and Venice Dettamanti Family Trust dated February 6, 1986, presents a Supplement to First Account and Report and Response to Objections; that it is obvious that the Trustee has made a few mistakes in trying to administer her parents’ trust, it is equally clear that she has tried to do her best. Her biggest mistake was her belief that she should do things the way her mother always had. That was far too informal for her new role as Trustee, and it has led to confusion and unforced errors. The accounting has been amended and is as complete as it can probably get. It would help all parties to accept that accounting and move forward with distributions. An eviction action has been filed to help get the Pellham property sold.
Trustee contends that before addressing the Objections, it is important to place the response to those objections in the proper historical context.
The 1986 Trust was drafted by a law firm in Oxnard in 19861 (Owen & Owen); however, at some point Henry and Venice began utilizing the services of Kevin Richards, a disbarred attorney. The disbarred attorney had some connection with the investment firm in Orcutt that the Dettamanti’s were using and apparently claimed for years that he was only performing “paralegal” duties. The woman who notarized the amendments (Julie Darrah) was the office manager for the investment firm and last year she agreed to a settlement with the SEC for embezzlement and financial elder abuse from multiple clients. The Trust was amended three times, twice when Henry was still alive and a third time in 2007 by Venice only and which as pertains to the Irrevocable Trust B, was not a valid amendment. The First Amendment, at ¶5, gave the surviving Settlor unlimited invasion powers as to the assets in Trust B (which presumably gave her the power to sell the house her son was living in and invade the Trust to give her son the proceeds). The First Amendment also eliminated the Sprinkling provisions contained in Article 6 and Article 7 of the original Trust. Paragraph 19 of the First Amendment also grants the Trustee “Broad Powers” for Distribution. Specifically, the Trustee is permitted reasonable discretion to make distributions “partly in-kind and partly in money…” This is consistent with ¶7.21 in the original Trust that gave the Trustee discretion to make a distribution in cash or in kind and “…the Trustees discretion shall control and be final.”
The Second Amendment named Liz as first Successor Trustee and Liz’s son Jeffrey Watkins as the Alternate.
The Third Amendment included a provision for Benjamin to repay his mother for saving his home in Lompoc (529 N. 7th Street) after Benjamin lost the house during a bankruptcy as well as invalid provisions regarding changes to the distribution of the B Trust.
Henry Dettamanti died in 2002. Venice Dettamanti died on July 25, 2022, at the age of 98. Venice was the Surviving Settlor and Sole Trustee from 2002 through October 2021. In viewing or passing judgment on successor Trustee, Elizabeth Watkins (sometimes “Liz”), it is important to understand how the trust had been managed by Henry and Venice Dettamanti prior to the Trusteeship being passed on to Liz. It is important when viewing the actions of Liz to understand the intentions of the Settlors.
Henry and Venice had two children, Benjamin, and Liz. Unfortunately, Benjamin died August 20, 2021. Under the terms of the Trust his share was now going to his two children, Mario, and Angelina.
What is most important in viewing the intention of the Settlors is the generosity they bestowed upon their family. The examples are countless, including purchasing homes for their children and supporting their grandchildren. When Benjamin Dettamanti lost his home in a bankruptcy in 2001, his parents paid $104,018 to cure the deficiency. They also purchased a home for Liz in Carpinteria. Although these homes were for their children, the titles were held in the name of the Trust. Neither Benjamin nor Liz ever paid rent while living in these properties.
Mario Dettamanti. In 2019, Venice’s attorney Michael Hardy was concerned by the number of checks to Mario and spoke with Venice but took no action. Bank records show checks regularly written by Mario and signed by Venice. There is no documentation of any services performed or receipts for reimbursements being claims. From September 2019 through March 15, 2021, Mario received an additional $74,000 from his grandmother, of which $58,000 or so was for “labor” and an additional $16,000 was for reimbursements. There are no receipts for reimbursements. Several are simply listed as “supplies” for $75 here and there. The custom and practice (for both Mario and Liz) was to have multiple purchases added up for a single reimbursement. Why there was never simply a debit or credit card for the Trust is a mystery.
Venice may have been declared to lack capacity in March 2021, but Venice continued writing checks until October 2021 when Liz officially took over as Trustee. Venice was the one writing checks into 2021, and Mario was her grandson. While they may represent gross overpayment, it was Venice’s trust. However, while the other caregivers received $20 per hour, Mario was receiving $3,700 per month for working 2 days per week. This works out to over $55 per hour. Thus, paying Mario from 2017-2022 cost the Trust nearly $100,000 more than what it would have cost to pay others. Was Liz Watkins supposed to cut Mario off when she took over? Fire him or tell him he needed to work at the same rate as everyone else? He had been getting paid this way from his grandmother for years before Liz took over and she continued to do the same because that was how Venice Dettamanti operated the Trust.
Houses Purchased by Henry and Venice Dettamanti for Their Children. Henry and Venice Dettamanti purchased homes for both of their children, including the house in Carpinteria (4465 La Tierra) that Elizabeth Watkins lives in. The Trust had also purchased a house for Benjamin Dettamanti in Lompoc (529 N. 7th Street). One of the objections from beneficiary Mario Dettamanti concerns the Carpinteria House. Elizabeth Watkins has lived in the Carpinteria house for over 30 years. It is a modest suburban tract home. When her parents (the Settlors of the Trust) were alive, Liz never paid rent. Mario is asking that Liz be surcharged for 50% of the fair rental value (she is also a 50% beneficiary) from the date of Venice Dettamanti’s death to the present. In addition, Mario is objecting to the distribution of the property to Liz, creating a Catch 22 situation where she may be liable for rent for some period of time, but cannot terminate that rental surcharge by distributing the property, thus accruing a larger surcharge. This is an unfair outcome that defies not only common sense, but the clear intent of the Settlors. It is this last point (the Settlor’s intent) that cannot be emphasized enough.
There is a suggestion that rent is appropriate because when the assets were allocated between the Survivor’s Trust and the By-Pass Trust, the residential properties in the B Trust were labeled “income property”. However, they were never treated as income properties during Settlors’ lifetimes. Neither Benjamin nor Liz ever paid rent. When Liz was transitioning into her role as Trustee, the longtime CPA Ron Levy prepared an updated asset list dated June 9, 2021, it listed the Carpinteria property simply as a Trust A asset. CPA Levy also states in his Declaration that the Carpinteria property was treated as a second home for tax purposes, not as a rental property. The property at 529 N. 7th Street in Lompoc was originally purchased by Ben Dettamanti and his then wife Francine Dettamanti in 1992. When Venice sold this property in 2018, Ben Dettamanti took all of the proceeds ($350,000) and Venice paid the capital gain taxes.
"[T]he primary rule in construction of trusts is that the court must, if possible, ascertain and effectuate the intention of the trustor or settlor. [Citations.]" (Ephraim v. Metropolitan Trust Co. (1946) 28 Cal.2d 824, 834.) In Getty v. Getty, a controversy arose over distribution of dividends. The Court relied on evidence of the Trustor’s historical conduct in making its findings: “Furthermore, since J. Paul was a trustor as well as a trustee, his own conduct before any controversy arose is persuasive evidence of his intent (Civ. Code, § 3535; Davenport v. Davenport Foundation, 36 Cal.2d 67, 73-74 ).” Getty v. Getty, 28 Cal.App.3d 996, 1004 (Cal. Ct. App. 1972).
Here, when we look at the Settlors’ conduct, particularly the actions of Venice towards her children and grandchildren, the notion that Liz Dettamanti should pay rent to the Trust, while others were beneficiaries of Venice Dettamanti’s largesse seems contrary to the Settlors intent.
Here, we have decades of evidence of the conduct and intent of both Henry and Venice Dettamanti, specifically as it relates to the Carpinteria property. It was never an income property from the date of purchase up through the date Venice died, a span of 30 years. Henry and Venice purchased homes for both of their children to live in, with Ben living in Lompoc and Liz living in Carpinteria, dating back to the 1990’s. But if some rent is due, it should be limited to a brief period after the death of Venice because Liz presumably had the power to distribute this asset sooner and should not be penalized by this Catch 22 situation. It is also important to note that Probate courts are courts of equity and with respect to the Carpinteria home, the distribution to allow Liz and her husband to continue living in their home is the only equitable outcome. To force these senior citizens out of their home is something Venice Dettamanti would never permit.
Supported by 22 footnotes.
Attaches: Exhibit A is the Dettamanti Family Trust; Exhibit B is the 2/6/86 First Amendment; Exhibit D is the Second Amendment; Exhibit C is the Third Amendment; Exhibit E is the 10/25/23 U.S. Securities and Exchange Litigation Release No. 25885; Exhibit F is the 2/6/86 Certification of Trust A; Exhibit G is the Declaration of Ron Levy in support of Petitioner’s Plan for distribution of Trust Assets; Exhibit H are Notes date 9/10/19; Exhibit I are Checks Written to Mario Dettamanti 9/2019 - 3/2921; Exhibit J is an Invoice; Exhibit K are Bank Statements from Mechanics Bank; Exhibit L is Cashier’s Check and Withdrawals from Mechanics Bank; Exhibit M are Mechanics Bank checks; Exhibit N are Mechanics Bank checks; Exhibit O are Mechanics Bank checks; Exhibit P are Mechanics Bank statements; Exhibit Q is the First Accounting for the period March 1, 2021 thru January 31, 2024 Summary of Account.
Objections and Rulings Thereon
OBJECTION NO. 1 – Failure to Disclose Family Relationship.
Response to Objection #1: Watkins Fence Company is a legitimate business operating in Oak View CA; attaches the invoices for the services provided; Liz made 2 payments: a $5,000 deposit (Check #4517) with the balance of $10,271.75 paid 2 weeks later; involved removal of large amounts of debris and old tires dumped on the property; money was paid to the workers and for equipment rental and dump fees; John Watkins received no monetary benefit from this project; the hiring of Watkins Fence resulted in a savings to the Trust as labor rates were lower than others and there was no markup for overhead and profit, which could run as high as 30%; hiring Watkins Fence Company was not self-dealing in that it did not benefit the Trustee in any way; Liz Watkins did write a check 4585 to John Watkins for $12,500. On the memo this transaction is listed as a loan. It was related to the Ventura County claim against Watkins Cattle Co. Liz believed she could make loans of the Trust property. This was not the correct way to handle the situation.
Objection is overruled.
OBJECTION NO. 2 - $13,000 Withdrawal.
Response to Objection #2. The $13,000 withdrawal was a transfer from one Trust account (MB6350) into another Trust account (MB4535). Like all things related to this case, there is a weird error on the bank statement for the deposit into account MB4535. On December 11, 2023 there is a deposit of $130, which the bank employee keyed in wrong. The deposit should have been $13,000. The following day there is a deposit correction of $12,870 (the balance of the $13,000 deposit/transfer). The reason for this transfer was to pay property taxes. Check numbers 4632 and 4633 are $7535.90 (for La Tierra) and $4,051.86 (for Pellham).
Objection is overruled.
OBJECTION NO. 3 – Unknown Disbursements.
Response to Objection #3. Most of the unknown disbursements have been addressed in the revised accounting.
Objection is overruled.
OBJECTION NO. 4 – Preliminary Distribution to Trustee.
Response to Objection #4. This is addressed in the revised accounting. The $40,000 and $13,500 items were transfers between trust accounts. From those transfers there were additional checks written to Watkins Cattle Co. again addressing the Ventura County fine; were not disclosed properly out of embarrassment and not as a means of taking from the Trust anything in excess of her beneficial interest; it just lacked transparency.
Objection is overruled.
OBJECTION NO. 5 – Unknown Disbursements.
Response to Objection #5; have been corrected. The Withdrawals from account 4535 on 8/14/23 ($5,000) and 8/21/23 ($6,000) are transfers into account xx5580. The 9/21/23 withdrawal of $7,803.74 was a payment for attorney’s fees. The $583.29 was from the closure of the B of A account (xx7894). Another transaction for $113 is a transfer. That leaves 4 unknown transactions totaling around $250 that Liz was unable to account for.
Objection is overruled.
OBJECTION NO. 6 – Life Insurance.
Response to Objection #6; this is not an objection, per se, but a request for clarification. Liz was not involved in these policies. The checks arrived. They were deposited. It may be that Venice outlived the death benefit and therefore received these payments as a return of remaining cash value.
Objection is overruled.
OBJECTION NO. 7 - Rental Income.
Response to Objection #7; All rental income is from the shopping center, as Objector points out. The final rent check in the amount of $14,454.29 was deposited on February 14, 2023, and is listed as a receipt in Trust A (p. 18). The three missing rent checks were bundled with the
Northwest Mutual deposit used to open bank account MB5580 on January 19, 2023.
Objection is overruled.
OBJECTION NO. 8 – Income.
Response to Objection #8; Liz was able to obtain copies of the deposited items that were categorized as miscellaneous income - income is from Long Term Care Insurance, tax refunds, etc.
There are a couple of very small items that remain “unknown.” These deposits have been clarified in the revised accounting schedules (Exhibit Q).
Objection is overruled.
OBJECTION NO. 9 – Lompoc Warehouse Dividends.
Response to Objection #9; a dividend check in the amount of $11,700 was received and included in the deposit on December 12, 2022, that is a total of $12,870. See revised accounting schedules (Exhibit Q).
Objection is overruled.
OBJECTION NO. 10 – Reimbursements.
Response to Objection #10; Mario wrote many checks for reimbursements, some during the accounting period signed by Venice. There are no receipts. From 2017-2022 the reimbursements are over $40,000. Liz has a shopping bag of receipts for expenses she incurred for her mother, some of which she bundled together and repaid herself and others she did not.
This bag of receipts was just recently uncovered and is still being reviewed. Bundling
these reimbursements, as Mario had always also done, has made the accounting more difficult, but the time and expense from Liz is undeniable.
Objection is overruled.
OBJECTION NO. 11 – Elks Lodge.
Response to Objection #11; one objection is over the labeling of Elks Lodge expenses as Caregiving, when they should have been identified as memorial expense; there is no disputing the validity of these charges; counsel and her husband, Mario, attended the memorial and the objection admits that they know that the expenditures for the Elks Lodge are legitimate.
Objection is overruled.
OBJECTION NO. 12 - Caregiver Expenses.
Response to Objection #12; Mario has made an objection to four checks labeled in the accounting schedules as “Caregiver” expenses. The payments in question total around $1,100 out of the roughly $266,000 in total caregiver expenses on the account ($76,000 of which were paid
to Mario). Check #4166 was in the amount of $60 and payable to Peggy Baldwin. The check was written in September 2021 and is signed by Venice Dettamanti (as are the other checks on that page of the Exhibit, including check #4164 payable to Mario). Liz has no specific recollection of this individual or this check, although the name Peggy Baldwin on the check might be in Mario’s handwriting. Check #4461 is dated 7/23/22 payable to Lidice Caravello. Lidice was one of the regular caregivers whose name appears on many, many checks listed in Schedule C of the accounting. Liz does not have a specific recollection of the details surrounding this particular check to Lidice. Check # 4374 is dated April 27, 2022 to Ement Massey. This was an individual that came and filled in; check #4504 is to Krahen Martinez for $150; check memo says Cleaning Center and he did garden services related to the shopping center and probably should have been classified in a different category. They are all legitimate expenses of the Trust.
Objection is overruled.
OBJECTION NO. 13 – Allocation of Income & Expenses.
Response to Objection #13; both rental income and many rental property expenses (for the shopping center, 1001 A Street, Lompoc) were charged to or deposited into accounts that were really Trust A accounts. The expenses and income are easily identifiable (more or less) from the schedules for Trust A. Where it becomes difficult are checks a few occasions that Mario was paid for some work on the shopping center. For example, check #4339 is for $4,700 rather than $3,700. This represents $1,000 paid for work at the shopping center, with the rest being for his usual payment for being with Venice. Ideally 2 checks would have been written, and there would be an invoice of some sort identifying what the $1,000 was for. As was typical, Mario wrote out a check for his Aunt Liz to sign.
Objection is overruled.
OBJECTION NO. 14 – Gain on Sale.
Response to Objection #14; according to the disbarred attorney, the shopping center was placed into Trust B and had a value as of Henry Dettamanti’s date of death of $495,000. There is no record supporting this valuation that Liz has seen. But there has been a Gain on Sale and there is also a corresponding Liability for estimated taxes (State and Federal). Taxes for 2023 have not been done and so Liz had not discussed this transaction with the CPA yet.
Objection is overruled.
OBJECTION NO. 15 – Carry Value of Shopping Center.
Response to Objection #15; see values above.
Objection is overruled.
OBJECTION NO. 16 – Trust B Assets.
Response to Objection #16; Trust B does have the Well Lot in addition to cash. The other asset was listed in the accounting appropriately on the list of Assets on Hand at the beginning and end of the accounting period. Not sure what the issue really is here.
Objection is overruled.
OBJECTION NO 17 – Discrepancy Between Schedules and Petition.
Response to Objection #17; There is a discrepancy between the Schedules and the Petition. The schedules are correct.
Objection is overruled.
OBJECTION NO. 18 – Unknown Disbursements.
Response to Objection #18; These Unknown Disbursements have been corrected and/or explained, as previously set forth in response to Objection 5.
Objection is overruled.
OBJECTION NO. 19 -Venice Dettamanti, Trustee.
Response to Objection #19; Objector complains that Venice Dettamanti is listed as Trustee on the accounting schedules. Venice Dettamanti was in fact the Trustee in March 2021, the beginning of the accounting period. Liz did not accept the Trusteeship until October 2021 and counsel had suggested that October 2021 was the proper start point for the accounting but has provided the accounting beginning in March 2021 per Court’s order. Should the schedules have listed both names? Probably, but counsel really did not catch the Trustee name issue and it is merely a proof-reading issue.
Objection is overruled.
OBJECTION NO. 20 – Statements.
Response to Objection #20; There are some statements still not available; however, all statements from active accounts with actual assets have been produced. There were two NW Mutual accounts when Liz became Trustee, but only the larger one was titled in the name of the Trust. In January 2023 Liz closed the NW Mutual accounts and deposited the 2 checks into a new bank account opened for Trust A at Mechanics Bank (account xxx5580). As can be seen from the statements, there is no activity for this account and the only change between June and December 2022 is the additional interest. Bank of America Account xx3700 had a running balance of $2,000.80 for 6 months straight. Nothing was added and the account was closed. The funds were deposited into MB4535 on November 17, 2023. Bank of America Account xx7894 was closed on 11/14/22 and the $583.29 was used by Liz as reimbursement for gas and other miscellaneous expenses. Mechanics Bank account xx4535. See attached as Exhibit P statements for the period September 2023 through the end of the accounting period.
Objection is overruled.
ADDITIONAL OBJECTION – Financial Advisor.
Response to additional objection; Objector has asked about the long-time financial advisor for Venice, Julie Darrah, who was shut down by the SEC last year. During the accounting period, there were no irregularities noted in any of the statements. The SEC Complaint and Stipulated “judgment” identified only 4 victims. The thefts by Darrah began in 2017. The investigation is on-going and counsel has reached out to the US Attorney handling this matter to determine if Venice was possibly a victim in the 2017-2021 timeframe. It seems unlikely though as the victims tended to be isolated. Here, not only were Mario and caregivers around all the time, Liz was also visiting her mother 3 times per week.
Objection is overruled.
Reply Brief of Mario Dettamanti
Re: Objection to accounting filed 5/15/24 by Objector Mario Dettamanti; 13 pages; summarized;
Mario requests the Court make the following orders:
1. The Trustee shall personally pay the costs of the accounting in the form of a surcharge under Probate Code section 16420, subdivision (a)(3).
2. The Trustee is denied any trustee fees to date.
3. The Trustee be surcharged $6,000 per month for living rent-free in the Carpinteria House for the period of March 24, 2021, to the date of final distribution.
4. Attorney’s fees and costs.
Mario also contends that the Trustee must clarify two remaining issues in the amended accounting: to wit:
A. What are the terms of the “loan” used to pay the Trustee’s restitution to the Ventura County District Attorney’s Office? The Trustee admits she took $65,000 of trust funds to pay restitution due to the Ventura County District Attorney’s Office because of a lawsuit against her business, Watkins Cattle Co. found in Petitioner’s Response to Objections filed May 10, 2024 (“Petitioner’s Response”, Exhibit Q, Trust A Schedule C, page 28.) She maintains that she believed, as trustee, she had the right to make loans of Trust property. (Petitioner’s Response, page 10, lines 13-14.)
The terms of the Trust do not allow the Trustee the power to make loans; the terms of the Trust require approval of most of the beneficiaries before the Trustee may vest income or principal to herself. The Trustee did not seek the beneficiaries’ approval before she took $65,000 of Trust funds.
Probate Code section 16244, subdivision (a) permits a trustee to loan trust funds to a beneficiary, provided the terms are fair and reasonable under the circumstances. Under the circumstances here, no loan could be fair and reasonable because Liz is both a beneficiary receiving the loan and the Trustee granting the loan. To loan herself money resulted in self-dealing. (Prob. Code, §16004, subd. (a).) This “loan” has not been repaid. (See Petitioner’s Response, Exhibit Q, Trust A Schedule A Receipts and Trust B Schedule A Receipts.) If this were truly a loan the Trustee intends to pay back, why is it not listed as an outstanding account receivable on the amended accounting? When is repayment due? What is the interest rate? Where is the promissory note? Or, perhaps, this is just like a $50,000 “loan” Liz received a few years before Venice passed that was never repaid. The Trustee must provide evidence to prove this is a legitimate loan and that the terms are fair and reasonable. Or, in the alternative, the Trustee must account for these funds as a preliminary distribution of her share.
B. Where are the missing Coasthills bank account funds? The amended accounting does not reflect Coasthills bank accounts that existed when Venice passed. Nor does the amended accounting reflect money from the accounts deposited into the Trust bank accounts. The Trustee must provide clarification and information as to the Coasthills accounts.
Contends the Trustee must be surcharged for living rent-free in the Carpinteria property. The Settlors intended Liz pay to live in the Carpinteria house after their death. The terms of the trust are “the manifestation of the settlor’s intent regarding a trust’s provisions.” (Prob. Code, § 19502, subd. (z).) Here, the terms of the Trust require the Trustee to obtain approval by a majority of beneficiaries before the Trustee vests income or principal to herself. (Petitioner’s Response, Exhibit A, page 13, section 7.2.)
Further, with respect to living in Trust property, the terms of the Trust require that the trustee lease assets from the Trust for fair market rent, as determined by an independent appraiser. (Petitioner’s Response, Exhibit B, page 3, section 10.) These terms clearly show that Henry and Venice intended that, when Liz became Trustee, (1) she would need the consent of most of the beneficiaries to continue living in the Carpinteria property, and (2) had she received that approval, Liz was required to pay fair rent.
Henry and Venice had numerous opportunities over nearly 40 years to give Liz the Carpinteria property if they had truly intended that Liz live rent- and property-tax-free all her life. Instead: Henry and Venice did not give Liz the money to purchase the Carpinteria property and did not allow title to be taken in Liz’s name and did not gift the Carpinteria property to Liz via a holographic amendment or a gift list, despite the ability to do so (Petitioner’s Response, Exhibit A, page 4, sections 3.1-3.6.) and although Henry and Venice twice amended the Trust, they did not amend or eliminate the provision that required a successor trustee to obtain majority approval to vest Trust income or principal to herself.
Although Venice twice amended the Trust after Henry passed (albeit invalidly done), Venice did not amend or eliminate the provision that required a successor trustee to obtain majority approval to vest Trust income or principal to herself; nor did Venice gift the property to Liz after Henry passed; but, Venice did give Ben the proceeds from the sale of the 7th Street property, and Venice did pay the capital gains tax from the sale without contribution by Ben; and, after the 7th Street property sale, Venice could have transferred the Carpinteria property to Liz or even written a holographic amendment or gift list to give Liz the property or allow her to live rent-free after Venice passed; but, she didn’t.
The Trustee was not approved to live in Trust property, but she did anyway. Liz’s first act as Trustee was to contact the beneficiaries to ask if they would approve her living in the Carpinteria property. (Exhibit A is a true and correct copy of this letter and notice.) This proves the Trustee knew she was required to seek approval by a majority of beneficiaries to live in Trust property. If she truly believed she could carry out her duties “the way her mother always had,” Liz would not have sought the beneficiaries’ approval in the first place. Neither Mario nor Angelina approved.
Contends the Trustee must be held accountable for causing delay and court intervention. The Trustee had three years and two months to produce a complete accounting. The beneficiaries asked for an accounting numerous times. Mario filed a previous Petition (SBSC Case No. 22PR00622) to request an accounting after nearly two years of delay, which he withdrew after the Trustee promised through previous counsel that the accounting was forthcoming. (It wasn’t.) The Trustee only produced an accounting after the Court ordered her to do so. Every Objector raised issues about the deficiencies shown in the Trustee’s accounting. Every Objector requested an amended and accurate accounting. And only after these objections did the Trustee produce a nearly complete accounting. Only after a correct accounting is approved can a plan for distribution be made and considered. That is why Objectors asked that the plan for distribution be considered only after the Trustee produces a correct accounting—not to create a “catch 22” that requires the Trustee pay more rent for her longer rent-free stay in Trust property. In any event, the Trustee agrees she handled Trust funds incorrectly and conducted her duties far too informally. Thus, the Trustee should be surcharged for the cost of the accounting and denied any compensation to date due to the issues stated herein. (Prob. Code, §§ 16420, subd. (a)(3), 16000 et seq.) The Trustee should also be surcharged the fair market rental value of $6,000 per month as previously appraised for living in the Carpinteria property since March 2021. (Exhibit B is a true and correct copy of the appraisal report evidencing the fair market rental value of the Carpinteria property of $6,000 per month.)
Supported by Exhibits A [letter of 10/26/21 from Montecito Law Group, P.C.]; Exhibit B [letter of dated 3/8/23 from Hammock, Arnold. Smith, & Co appraising the real property at 4465 La Tierra Lane; fair value $1,425,000 and fair market rent $6,000/mo.
The Court’s Conclusions
The underlying fact is that the Trustee’s proposal and report is reasonable and except for the issue of the rent on the Carpinteria property it is acceptable to the Court.
The request that the Trustee shall personally pay the costs of the accounting in the form of a surcharge under Probate Code section 16420, subdivision (a)(3) and that the Trustee be denied any trustee fees to date should be denied; this was an unusually complicated matter that was vigorously contested; it was contentious; sometimes acrimonious; under such circumstances this order is not warranted.
The request that the Objectors should be awarded attorney’s fees and costs and that Trustee should not be awarded attorney’s fees and costs, should be denied for the same reasons as stated above.
The request that the Trustee be surcharged $6,000 per month for living rent-free in the Carpinteria House for the period of March 24, 2021, to the “date of distribution”[2] must be granted; the Court has not ignored the Trustee’s contentions to the contrary, but the weight of the evidence preponderates against her. Objector Mario’s contentions have merit and is persuasive. The Carpentaria property should be distributed as soon as possible, and the surcharge money should be withheld by the Trustee subject to distribution at the time of the Final Distribution. A positive effect of doing that now would be to stop the surcharge.
The Trustee’s proposal to withhold $100,000 from immediate distribution to address pending and anticipated litigation [leaving $3,654,041.63 for immediate distribution] is reasonable under all the circumstances and should be approved.
The Trustee testified that there is a preliminary injunction entered preventing distributions of Angelina Dettamanti’s share of the Trust [to wit: Angelina Dettamanti (25%) = $913,510.41] and there has been neither a contention raised to the contrary nor anything presented to permit the Court to now strike that request and therefore it should be permitted without prejudice to be revisited at the time of the Final Accounting.
Mario’s contention that the Trustee must clarify two remaining issues in the amended accounting are both denied without prejudice; they were just raised in the Reply; they are considered “new issues” and cannot now be considered; to wit:
- What are the terms of the “loan” used to pay the Trustee’s restitution to the Ventura County District Attorney’s Office? [3]
- Where are the missing Coasthills bank account funds?[4]
This will be the Order of the Court. A further written order is not required.
[1] References an Exhibit G to the Petition to support that allegation but there was no such Exhibit attached.
[2] The Court notes that Objector used the word “final” distribution, but the Court finds that Trustee need not wait until “final distribution” but may be made at the time of this “initial distribution.”
[3] The Trustee admits she took $65,000 of trust funds to pay restitution due to the Ventura County District Attorney’s Office because of a lawsuit against her business, Watkins Cattle Co. found in Petitioner’s Response to Objections filed May 10, 2024 (“Petitioner’s Response”, Exhibit Q, Trust A Schedule C, page 28.) She maintains that she believed, as trustee, she had the right to make loans of Trust property. (Petitioner’s Response, page 10, lines 13-14.) The terms of the Trust do not allow the Trustee the power to make loans; the terms of the Trust require approval of the majority of beneficiaries before the Trustee may vest income or principal to herself. The Trustee did not seek the beneficiaries’ approval before she took $65,000 of Trust funds. Probate Code section 16244, subdivision (a) permits a trustee to loan trust funds to a beneficiary, provided the terms are fair and reasonable under the circumstances. Under the circumstances here, no loan could be fair and reasonable because Liz is both a beneficiary receiving the loan and the Trustee granting the loan. To loan herself money resulted in self-dealing. (Prob. Code, §16004, subd. (a).) This “loan” has not been repaid. (See Petitioner’s Response, Exhibit Q, Trust A Schedule A Receipts and Trust B Schedule A Receipts.) If this were truly a loan the Trustee intends to pay back, why is it not listed as an outstanding account receivable on the amended accounting? When is repayment due? What is the interest rate? Where is the promissory note? Or, perhaps, this is just like a $50,000 “loan” Liz received a few years before Venice passed that was never repaid. The Trustee must provide evidence to prove this is a legitimate loan and that the terms are fair and reasonable. Or, in the alternative, the Trustee must account for these funds as a preliminary distribution of her share.
[4] The amended accounting does not reflect Coasthills bank accounts that existed when Venice passed. Nor does the amended accounting reflect money from the accounts deposited into the Trust bank accounts. The Trustee must provide clarification and information as to the Coasthills accounts.