Contempt of Court Against Former Trustees | Sacramento, California

Contempt of Court Against Former Trustees | Sacramento, California

• August 29, 2016 - Abused Beneficiaries, Trust Litigation,

You petition the Probate Court for an Order To Suspend the Powers of a Trustee or to remove the Trustee of a Trust. You also seek to enjoin the Trustee from using trust funds for his or her defense. The Probate Judge grants a hearing. The hearing is held and the California Superior Court grants the Petition and a suspension and/or removal of the trustee is ordered. The Court also orders the appointment of the Successor Trustee. The Court will also order the former trustee to turn over all the assets of the trust to the Successor Trustee. The former trustee is usually ordered to render an accounting to the court within 30 to 60 days of the order.

The Successor Trustee begins the process of deciphering the financial actions of the predecessor trustee. Questionable money and property transfers become evident. Now what follows?

A variety of petitions and court motions may follow, among them: A petition against the former trustee alleging wrongful acquisition and misappropriation of trust assets; an action against the former trustee to compel the return of real property, financial elder abuse, breach of fiduciary obligation, conversion and imposition of a constructive trust; a petition for an order compelling a forensic accounting of the trust for the time period that the removed trustee managed the trust; a petition to freeze the bank accounts of the former trustee; and enforcement petitions following the former trustee’s failure to account.

How does all of this come about? While there are familiar patterns of enforcement actions against a former trustee, the necessity for such enforcement may be brief, or it may become protracted because of the intransigence of the former fiduciary. The initial part of the process against the former trustee begins with the Court order that the removed trustee renders an accounting to the court. The accounting does not get filed within the requisite time.

On petition of the successor trustee or other interested party the Superior Court Probate Judge signs an Order To Show Cause (OSC) Re Contempt, ordering the former trustee to appear before the Court to show cause why he or she should not be held in contempt for violation of the Court’s prior orders. The former trustee must be personally served with a copy of the Notice of Hearing and a copy of the petition.

It is not unusual that the former trustee fails to account and fails to appear at the Court hearing. The Probate Court may then impose monetary sanctions against the former trustee and set a new hearing date with an order that the former trustee appear. Next steps follow.

Disobedience of any lawful judgment, order, or process of the Court is contempt of the authority of the Court. (Code of Civil Procedure § 1209(a)(5).) “The order to show cause acts as a summons to appear in court on a certain day and, as its name suggests, to show cause why a certain thing should not be done. (Morelli v. Superior Court (1968) 262 Cal.App.2d 262, 269, 68 Cal.Rptr. 572.) Unless the citee (in this case the former trustee) has concealed himself from the court, he must be personally served with the affidavit and the order to show cause; otherwise, the court lacks jurisdiction to proceed. (§ 1015 [in civil actions in which a party is represented by an attorney, ‘the service of papers, when required, must be upon the attorney instead of the party, except service of subpoenas, of writs, and other process issued in the suit, and of papers to bring him into contempt’]; see also § 1016; Arthur v. Superior Court, supra, 62 Cal.2d at p. 408, 42 Cal.Rptr. 441, 398 P.2d 777; and see Weil & Brown, supra, § 9:716, p. 9(11)-47.) [Footnote omitted.]” (Cedars-Sinai Imaging Medical Group v. Superior Court (2000) 83 Cal.App.4th 1281, 1286-1287.)

Former trustees may find that their way of doing business in the past does not work very well when they disobey court orders. A violation of California’s contempt of court law is a misdemeanor, punishable by a fine and up to six months in a county jail.

So if you’re frustrated with the disobedience of a former trustee to a court order, you do have a remedy that is well-founded in the law and well grounded in the court’s own need to keep the respect for its orders intact.

Here at Hackard Law we are at the top of the game in estate, trust and probate litigation. If you’re facing an estate litigation issue, you can reach us at (916) 313-3030.