There hasn't been a ton of interesting action in the Ninth Circuit or California Court of Appeal lately, but I've been thinking a little about this opinion ever since it came out the day before yesterday.
It's not that I disagree with either the result or the reasoning. It's actually an outstanding opinion by Justice Fueur, and I'm totally down with everything she says. Indeed, in my mind, the case is a great example why we have appeal as a matter of right. Because sometimes, a single judge gets it wrong, and it makes sense to have three smart judges take at least a quick look at the thing (and sometimes a deeper look) to correct any errors that might have transpired. Even if in the majority of cases, the result ends up getting affirmed.
Here, by contrast, there's a reversal. And rightly so.
To me, the ruling in the trial court is a great example of how, on occasion, judges get too bogged down in doctrine and purported efforts to confine themselves to contractual (or statutory) language and, in doing so, leave common sense behind.
The question here is how to distribute the assets of a revocable trust once the settlor dies. In 2011, an unmarried mother, Ya-Ching Tung, established a trust that designated as successor beneficiaries her three adult children. Typical. Moreover, the trust contained all the usual boilerplate paragraphs about additional property that might be added to the trust, the 30-day survivor provision, a no contest clause, etc.
In 2016, the oldest of the three children died, leaving behind his three kids. That son was supposed to get the majority of the property in the trust. In 2019, the settlor (the mother) died, and shortly thereafter, in 2020, one of the two daughters in the trust also died, without issue. That left alive only one of the three original children -- the one who was originally supposed to get a tiny fraction of what was in the trust (less than 1/6th) -- alongside the three grandkids, the children of the eldest son.
The surviving daughter then becomes the trustee of the trust, and petitions to have . . . get this . . . all of the trust property given to her, because she was the only direct child still alive. She admits that California law generally says (of course it does!) that surviving children generally stand in the shoes of their parents if the parents are beneficiaries and die. But the surviving daughter says that doesn't apply because the boilerplate 30-day survivor provision of the trust "demonstrates a contrary intent" and means that the three grandchildren are totally cut out, leaving the daughter as the sole beneficiary.
The trial court agrees with her. The Court of Appeal reverses.
As I said, I'm totally on board for Justice Feuer's reasoning and result. [My bad on the original spelling, though -- sorry about that!] Spot on right.
But I was also fundamentally displeased with how the trial court went about its task here. Yes, we're interpreting a written document -- a trust. Yes, we generally follow what it says, and look to what the terms mean. Yes, I understand why a judge might (wrongly) view the 30-day survivor provision as perhaps saying that if one of kids predeceases her, that kid is treated as dead. (Though, truthfully, that provision is really just intended to avoid the problem of figuring out "who died first" in a situation in which the settlor and one of the beneficiaries gets offed in the same incident.)
But here's the thing. There's zero reason to think that that's how the settlor ACTUALLY intended her trust to be distributed. There's ZERO reason why the grandmother would purportedly want the child who she gave the least amount under the trust (less than a sixth) to have the whole thing, while leaving her grandkids out in the cold merely because their mother had the misfortune of dying first. That's not how people actually act. I'm a thousand percent confident that was not, in fact, the settlor's intent. Yet that's what the trial court ended up deciding.
Common sense should matter. Actuating the intent of the written instrument should matter. That's got to play a role. Even if you think -- and especially if you think mistakenly -- that the words in the document technically or literally mean something else.
Text matters. So does intent.
And yeah, yeah, yeah, I know the whole parole evidence rule and the like. I understand that principle. Ditto for statutory interpretation, which follows the same general principle.
But written text is often more ambiguous than what we facially perceive it to be. Particularly when, as here, we've got a very reasonable, common sense interpretation of what that written text was intended to do.
Short version: Don't lose the forest for the trees. Don't forget what we're actually trying to do in cases like this one. Yes, we're reading text. But we're also very much trying to effectuate intent.
Don't leave common sense behind.