How to Navigate Trust Amendments: When Probate Code Compliance Meets Trust Procedure Failures
Earlier this year, the California Supreme Court ruled that a trust amendment can be valid even if the trustor did not follow the specific amendment procedure referenced in the trust document itself because the trustor (trust creator) complied with the statutory revocation procedure. This decision ultimately hinges on whether the trust explicitly states that its method for amendment is the exclusive means for doing so.
When a trust amendment meets the requirements of the California Probate Code for modification but does not follow the trust’s specific procedure, it can still be valid if the trust does not explicitly state that its method is the exclusive amendment method (in other words, when a trust provides a specific amendment procedure, that procedure must be followed for an amendment to be valid.)
California Probate Code
California Probate Code §§15401 and 15402 state that a trust may be modified (1) by compliance with any method provided in the trust instrument; or (2) by a writing signed by the trustor and delivered to the trustee, unless the trust expressly provides a specific method of modification and clearly makes that method exclusive.
Haggerty v. Thornton
The California Court of Appeal discussed these principles in the case of Haggerty v. Thornton (2021) 68 Cal.App.5th 1003. The court held that a trust amendment was valid under the statutory method, provided the trust instrument did not explicitly make its own amendment procedures exclusive. The trust at issue indicated that amendment required a notarized instrument. A 2016 Amendment was notarized, but a 2018 Amendment was not.
The trial court found that the 2018 Amendment was valid under the statutory method because the trust instrument’s amendment procedures were not explicitly exclusive. The appellate court agreed: Unless a trust expressly limits amendments to its own procedures, statutory methods can be used.
The California Supreme Court took up the case in Haggerty v. Thornton (2024) 15 Cal.5th 729. The Supreme Court upheld the trial court and appellate court’s decision that the method of modifying a revocable trust through the statutory procedure in the California Probate Code was also available (even though it did not comply with the trust instrument’s own amendment provisions).
The Supreme Court analyzed the statutory provisions under Section 150401 and 15402. It held that a trust amendment was valid even though the trustor failed to follow the trust instrument’s own amendment procedures because the trustor complied with the statutory amendment procedure, and the trust instrument’s stated amendment method was not explicitly exclusive
Practical Considerations
The California Supreme Court decision means that a settlor may modify a trust using the trust instrument’s stated amendment method or the statutory method, unless the trust says that the trust’s amendment method is the exclusive method. The statutory procedure only requires that the modification of a revocable trust be made in writing, signed by the settlor and delivered to the trustee. It does not require the writing to be notarized.
The Supreme Court’s decision under Haggerty has significant implications for how trust amendments are executed and validated in California. If the trustor intends to preclude the use of a statutory method for modification, trustors (and their attorneys) must clearly specify in the original trust document a particular amendment method and state that method is exclusive. That method must be followed when attempting amendments. Otherwise, an amendment may be invalidated for failure to comply with the trust document’s exclusive amendment method.
Should you have any questions regarding your reporting obligations, and whether the implications of Haggerty may apply to you or your trust, please contact your BBK attorney or Christine Chacon or Michael Russo.
Disclaimer: BBK Legal Alerts are not intended as legal advice. Additional facts, facts specific to your situation, or future developments may affect subjects contained herein. Seek the advice of an attorney before acting or relying upon any information herein.
