Does a court apply an abuse of discretion standard to review an order concerning a request to pay a trustee's attorney fees from the trust's assets?

California, United States of America


The following excerpt is from Amiad v. Cohen, G043076 (Cal. App. 2011):

Courts "apply an abuse of discretion standard" to review an order concerning a request to pay a trustee's attorney fees from the trust's assets. (Donahue v. Donahue (2010) 182 Cal.App.4th 259, 268-269.) "In reviewing whether the trial court abused its discretion, 'we are mindful that "[t]he underlying principle which guides the court in allowing costs and attorney fees incidental to litigation out of a trust estate is that such litigation is a benefit and a service to the trust." [Citation.]' [Citation.] 'If litigation is necessary for the preservation of the trust, the trustee is entitled to reimbursement for his or her expenditures from the trust; however, if the litigation is specifically for the benefit of the trustee, the trustee must bear his or her own costs incurred, and is not entitled to reimbursement from the trust.' [Citation.]" (Id. at p. 270.)

Plaintiffs note the trial court found defendant "paid her lawyers . . . from the trust to defend her in the contest . . . . She was not defending the trust but the amendment[s] that benefitted her." Thus, the trial court found, in effect, "[t]he essence of the underlying action was . . . a dispute over who would control and benefit from [the trust]" and, regardless of "[w]hether or not the contest prevailed, the trust would remain intact." (Whittlesey v. Aiello (2002) 104 Cal.App.4th 1221, 1228.) In light of the trial court's finding, defendant's reliance on a trust provision concerning reimbursement for litigation expenses incurred to defend against an action that purportedly violates the no contest clause is not persuasive.

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