BILL NUMBER: AB 1784 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY APRIL 30, 2002
INTRODUCED BY Assembly Member Harman
JANUARY 14, 2002
An act to repeal Sections 1071 and 1073 of the Civil Code, to
amend Sections 221, 230, 250, 6130 6103
, 6205, 6409, 11640, 21101, 21102, 21103, 21104, 21105, 21107,
21108, 21109, 21110, 21111, 21112, 21114, 21115, 21117, 21118, 21120,
21121, 21122, 21131, 21133, 21134, 21135, 21139, and 21140 of, to
repeal Sections 21106, 21113, 21116, 21136, 21137, and 21138 of, and
to repeal and add Section 21132 to, the Probate Code, relating to
construction of instruments.
LEGISLATIVE COUNSEL'S DIGEST
AB 1784, as amended, Harman. Construction of instruments.
Existing law provides rules for the interpretation of wills,
trusts, deeds, and other instruments, which are to be used as
interpretive aids where the intention of the transferor is not
indicated by the instrument.
This bill would revise the above-described rules for
interpretation by, among other things, clarifying the appropriate use
of extrinsic evidence to determine the intention of the transferor;
making changes in terminology; limiting the application of certain
rules to specified transfers; conforming certain rules with the
Uniform Probate Code; adding new provisions regarding securities;
repealing certain rules; eliminating redundant provisions; and making
technical and conforming revisions.
Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 1071 of the Civil Code is repealed.
SEC. 2. Section 1073 of the Civil Code is repealed.
SEC. 3. Section 221 of the Probate Code is amended to read:
221. (a) This chapter does not apply in any case where Section
103, 6211, or 6403 applies.
(b) This chapter does not apply in the case of a trust, deed, or
contract of insurance, or any other situation, where (1) provision is
made dealing explicitly with simultaneous deaths or deaths in a
common disaster or otherwise providing for distribution of property
different from the provisions of this chapter or (2) provision is
made requiring one person to survive another for a stated period in
order to take property or providing for a presumption as to
survivorship that results in a distribution of property different
from that provided by this chapter.
SEC. 4. Section 230 of the Probate Code is amended to read:
230. A petition may be filed under this chapter for any one or
more of the following purposes:
(a) To determine for the purposes of Section 103, 220, 222, 223,
224, 6211, 6242, 6243, 6403, 21109, 21110 or other provision of this
code whether one person survived another.
(b) To determine for the purposes of Section 673 whether issue of
an appointee survived the donee.
(c) To determine for the purposes of Section 24611 of the
Education Code whether a person has survived in order to receive
benefits payable under the system.
(d) To determine for the purposes of Section 21509 of the
Government Code whether a person has survived in order to receive
money payable under the system.
SEC. 5. Section 250 of the Probate Code is amended to read:
250. (a) A person who feloniously and intentionally kills the
decedent is not entitled to any of the following:
(1) Any property, interest, or benefit under a will of the
decedent, or a trust created by or for the benefit of the decedent or
in which the decedent has an interest, including any general or
special power of appointment conferred by the will or trust on the
killer and any nomination of the killer as executor, trustee,
guardian, or conservator or custodian made by the will or trust.
(2) Any property of the decedent by intestate succession.
(3) Any of the decedent's quasi-community property the killer
would otherwise acquire under Section 101 or 102 upon the death of
the decedent.
(4) Any property of the decedent under Part 5 (commencing with
Section 5700) of Division 5.
(5) Any property of the decedent under Part 3 (commencing with
Section 6500) of Division 6.
(b) In the cases covered by subdivision (a):
(1) The property interest or benefit referred to in paragraph (1)
of subdivision (a) passes as if the killer had predeceased the
decedent and Section 21110 does not apply.
(2) Any property interest or benefit referred to in paragraph (1)
of subdivision (a) which passes under a power of appointment and by
reason of the death of the decedent passes as if the killer had
predeceased the decedent, and Section 673 not apply.
(3) Any nomination in a will or trust of the killer as executor,
trustee, guardian, conservator, or custodian which becomes effective
as a result of the death of the decedent shall be interpreted as if
the killer had predeceased the decedent.
SEC. 6. Section 6103 of the Probate Code is amended to read:
6103. Except as otherwise specifically provided, Chapter 1
(commencing with Section 6100), Chapter 2 (commencing with Section
6110), Chapter 3 (commencing with Section 6120), Chapter 4
(commencing with Section 6130), Chapter 6 (commencing with Section
6200), and Chapter 7 (commencing with Section 6300) of this division,
and Part 1 (commencing with Section 21101) of Division 11, do not
apply where the testator died before January 1, 1985, and the law
applicable prior to January 1, 1985, continues to apply where the
testator died before January 1, 1985.
SEC. 7. Section 6205 of the Probate Code is amended to read:
6205. "Descendants" mean children, grandchildren, and their
lineal descendants of all generations, with the relationship of
parent and child at each generation being determined as provided in
Section 21115. A reference to "descendants" in the plural includes a
single descendant where the context so requires.
SEC. 8. Section 6409 of the Probate Code is amended to read:
6409. (a) If a person dies intestate as to all or part of his or
her estate, property the decedent gave during lifetime to an heir is
treated as an advancement against that heir's share of the intestate
estate only if one of the following conditions is satisfied:
(1) The decedent declares in a contemporaneous writing that the
gift is an advancement against the heir's share of the estate or that
its value is to be deducted from the value of the heir's share of
the estate.
(2) The heir acknowledges in writing that the gift is to be so
deducted or is an advancement or that its value is to be deducted
from the value of the heir's share of the estate.
(b) Subject to subdivision (c), the property advanced is to be
valued as of the time the heir came into possession or enjoyment of
the property or as of the time of death of the decedent, whichever
occurs first.
(c) If the value of the property advanced is expressed in the
contemporaneous writing of the decedent, or in an acknowledgment of
the heir made contemporaneously with the advancement, that value is
conclusive in the division and distribution of the intestate estate.
(d) If the recipient of the property advanced fails to survive the
decedent, the property is not taken into account in computing the
intestate share to be received by the recipient's issue unless the
declaration or acknowledgment provides otherwise.
SEC. 9. Section 11640 of the Probate Code is amended to read:
11640. (a) When all debts have been paid or adequately provided
for, or if the estate is insolvent, and the estate is in a condition
to be closed, the personal representative shall file a petition for,
and the court shall make, an order for final distribution of the
estate.
(b) The court shall hear and determine and resolve in the order
all questions arising under Section 21135 (ademption by satisfaction)
or Section 6409 (advancements).
(c) If debts remain unpaid or not adequately provided for or if,
for other reasons, the estate is not in a condition to be closed, the
administration may continue for a reasonable time, subject to
Chapter 1 (commencing with Section 12200) of Part 11 (time for
closing estate).
SEC. 10. Section 21101 of the Probate Code is amended to read:
21101. Unless the provision or context otherwise requires, this
part applies to a will, trust, deed, and any other instrument.
SEC. 11. Section 21102 of the Probate Code is amended to read:
21102. (a) The intention of the transferor as expressed in the
instrument controls the legal effect of the dispositions made in the
instrument.
(b) The rules of construction in this part apply where the
intention of the transferor is not indicated by the instrument.
(c) Nothing in this section limits the use of extrinsic evidence,
to the extent otherwise authorized by law, to determine the intention
of the transferor.
SEC. 12. Section 21103 of the Probate Code is amended to read:
21103. The meaning and legal effect of a disposition in an
instrument is determined by the local law of a particular state
selected by the transferor in the instrument unless the application
of that law is contrary to the rights of the surviving spouse to
community and quasi-community property, to any other public policy of
this state applicable to the disposition, or, in the case of a will,
to Part 3 (commencing with Section 6500) of Division 6.
SEC. 13. Section 21104 of the Probate Code is amended to read:
21104. As used in this part, "at-death transfer" means a transfer
that is revocable during the lifetime of the transferor, but does
not include a joint tenancy or joint account with right of
survivorship.
SEC. 14. Section 21105 of the Probate Code is amended to read:
21105. Except as otherwise provided in Sections 641 and 642, a
will passes all property the testator owns at death, including
property acquired after execution of the will.
SEC. 15. Section 21106 of the Probate Code is repealed.
SEC. 16. Section 21107 of the Probate Code is amended to read:
21107. If an instrument directs the conversion of real property
into money at the transferor's death, the real property and its
proceeds shall be deemed personal property from the time of the
transferor's death.
SEC. 17. Section 21108 of the Probate Code is amended to read:
21108. The law of this state does not include (a) the common-law
rule of worthier title that a transferor cannot devise an interest to
his or her own heirs or (b) a presumption or rule of interpretation
that a transferor does not intend, by a transfer to his or her own
heirs or next of kin, to transfer an interest to them. The meaning
of a transfer of a legal or equitable interest to a transferor's own
heirs or next of kin, however designated, shall be determined by the
general rules applicable to the interpretation of instruments.
SEC. 18. Section 21109 of the Probate Code is amended to read:
21109. (a) A transferee who fails to survive the
transferor of an at-death transfer or until any future time required
by the instrument does not take under the instrument.
(b) If it cannot be determined by clear and convincing evidence
that the transferee survived until a future time required by the
instrument, it is deemed that the transferee did not survive until
the required future time.
SEC. 19. Section 21110 of the Probate Code is amended to read:
21110. (a) Subject to subdivision (b), if a transferee is dead
when the instrument is executed, or fails or is treated as failing to
survive the transferor or until a future time required by the
instrument, the issue of the deceased transferee take in the
transferee's place in the manner provided in Section 240. A
transferee under a class gift shall be a transferee for the purpose
of this subdivision unless the transferee's death occurred before the
execution of the instrument and that fact was known to the
transferor when the instrument was executed.
(b) The issue of a deceased transferee do not take in the
transferee's place if the instrument expresses a contrary intention
or a substitute disposition. A requirement that the initial
transferee survive the transferor or survive for a specified
period of time after the death of the transferor constitutes a
contrary intention. A requirement that the initial transferee
survive until a future time that is related to the probate of the
transferor's will or administration of the estate of the transferor
constitutes a contrary intention.
(c) As used in this section, "transferee" means a person who is
kindred of the transferor or kindred of a surviving, deceased, or
former spouse of the transferor.
SEC. 20. Section 21111 of the Probate Code is amended to read:
21111. (a) Except as provided in subdivision (b) and subject to
Section 21110, if a transfer fails for any reason, the property is
transferred as follows:
(1) If the transferring instrument provides for an alternative
disposition in the event the transfer fails, the property is
transferred according to the terms of the instrument.
(2) If the transferring instrument does not provide for an
alternative disposition but does provide for the transfer of a
residue, the property becomes a part of the residue transferred under
the instrument.
(3) If the transferring instrument does not provide for an
alternative disposition and does not provide for the transfer of a
residue, or if the transfer is itself a residuary gift, the property
is transferred to the decedent's estate.
(b) Subject to Section 21110, if a residuary gift or a future
interest is transferred to two or more persons and the share of a
transferee fails for any reason, and no alternative disposition is
provided, the share passes to the other transferees in proportion to
their other interest in the residuary gift or the future interest.
(c) A transfer of "all my estate" or words of similar import is a
residuary gift for purposes of this section.
(d) If failure of a future interest results in an intestacy, the
property passes to the heirs of the transferor determined pursuant to
Section 21114.
SEC. 21. Section 21112 of the Probate Code is amended to read:
21112. A condition in a transfer of a present or future interest
that refers to a person's death "with" or "without" issue, or to a
person's "having" or "leaving" issue or no issue, or a condition
based on words of similar import, is construed to refer to that
person's being dead at the time the transfer takes effect in
enjoyment and to that person either having or not having, as the case
may be, issue who are alive at the time of enjoyment.
SEC. 22. Section 21113 of the Probate Code is repealed.
SEC. 23. Section 21114 of the Probate Code is amended to read:
21114. (a) If a statute or an instrument provides for transfer of
a present or future interest to, or creates a present or future
interest in, a designated person's "heirs," "heirs at law," "next of
kin," "relatives," or "family," or words of similar import, the
transfer is to the persons, including the state under Section 6800,
and in the shares , that would succeed to the
designated person's intestate estate under the intestate succession
law of the designated person's domicile
transferor's domicile, if the designated person died when the
transfer is to take effect in enjoyment. If the designated person's
surviving spouse is living but is remarried at the time the transfer
is to take effect in enjoyment, the surviving spouse is not an heir
of the designated person for purposes of this section.
(b) As used in this section, "designated person" includes the
transferor.
SEC. 24. Section 21115 of the Probate Code is amended to read:
21115. (a) Except as provided in subdivision (b), halfbloods,
adopted persons, persons born out of wedlock, stepchildren, foster
children, and the issue of these persons when appropriate to the
class, are included in terms of class gift or relationship in
accordance with the rules for determining relationship and
inheritance rights for purposes of intestate succession.
(b) In construing a transfer by a transferor who is not the
natural parent, a person born to the natural parent shall not be
considered the child of that parent unless the person lived while a
minor as a regular member of the household of the natural parent or
of that parent's parent, brother, sister, spouse, or surviving
spouse. In construing a transfer by a transferor who is not the
adoptive parent, a person adopted by the adoptive parent shall not be
considered the child of that parent unless the person lived while a
minor (either before or after the adoption) as a regular member of
the household of the adopting parent or of that parent's parent,
brother, sister, or surviving spouse.
(c) Subdivisions (a) and (b) shall also apply in determining:
(1) Persons who would be kindred of the transferor or kindred of a
surviving, deceased, or former spouse of the transferor under
Section 21110.
(2) Persons to be included as issue of a deceased transferee under
Section 21110.
(3) Persons who would be the transferor's or other designated
person's heirs under Section 21114.
(d) The rules for determining intestate succession under this
section are those in effect at the time the transfer is to take
effect in enjoyment.
SEC. 25. Section 21116 of the Probate Code is repealed.
SEC. 26. Section 21117 of the Probate Code is amended to read:
21117. At-death transfers are classified as follows:
(a) A specific gift is a transfer of specifically identifiable
property.
(b) A general gift is a transfer from the general assets of the
transferor that does not give specific property.
(c) A demonstrative gift is a general gift that specifies the fund
or property from which the transfer is primarily to be made.
(d) A general pecuniary gift is a pecuniary gift within the
meaning of Section 21118.
(e) An annuity is a general pecuniary gift that is payable
periodically.
(f) A residuary gift is a transfer of property that remains after
all specific and general gifts have been satisfied.
SEC. 27. Section 21118 of the Probate Code is amended to read:
21118. (a) If an instrument authorizes a fiduciary to satisfy a
pecuniary gift wholly or partly by distribution of property other
than money, property selected for that purpose shall be valued at its
fair market value on the date of distribution, unless the instrument
expressly provides otherwise. If the instrument permits the
fiduciary to value the property selected for distribution as of a
date other than the date of distribution, then, unless the instrument
expressly provides otherwise, the property selected by the fiduciary
for that purpose shall fairly reflect net appreciation and
depreciation (occurring between the valuation date and the date of
distribution) in all of the assets from which the distribution could
have been made.
(b) As used in this section, "pecuniary gift" means a transfer of
property made in an instrument that either is expressly stated as a
fixed dollar amount or is a dollar amount determinable by the
provisions of the instrument.
SEC. 28. Section 21120 of the Probate Code is amended to read:
21120. The words of an instrument are to receive an
interpretation that will give every expression some effect, rather
than one that will render any of the expressions inoperative.
Preference is to be given to an interpretation of an instrument that
will prevent intestacy or failure of a transfer, rather
than one that will result in an intestacy or failure of a
transfer.
SEC. 29. Section 21121 of the Probate Code is amended to read:
21121. All parts of an instrument are to be construed in relation
to each other and so as, if possible, to form a consistent whole.
If the meaning of any part of an instrument is ambiguous or doubtful,
it may be explained by any reference to or recital of that part in
another part of the instrument.
SEC. 30. Section 21122 of the Probate Code is amended to read:
21122. The words of an instrument are to be given their ordinary
and grammatical meaning unless the intention to use them in another
sense is clear and their intended meaning can be ascertained.
Technical words are not necessary to give effect to a disposition in
an instrument. Technical words are to be considered as having been
used in their technical sense unless (a) the context clearly
indicates a contrary intention or (b) it satisfactorily appears that
the instrument was drawn solely by the transferor and that the
transferor was unacquainted with the technical sense.
SEC. 31. Section 21131 of the Probate Code is amended to read:
21131. A specific gift passes the property transferred subject to
any mortgage, deed of trust, or other lien existing at the date of
death, without right of exoneration, regardless of a general
directive to pay debts contained in the instrument .
SEC. 32. Section 21132 of the Probate Code is repealed.
SEC. 33. Section 21132 is added to the Probate Code, to read:
21132. (a) If a transferor executes an instrument that makes an
at-death transfer of securities and the transferor then owned
securities that meet the description in the instrument, the transfer
includes additional securities owned by the transferor at death to
the extent the additional securities were acquired by the transferor
after the instrument was executed as a result of the transferor's
ownership of the described securities and are securities of any of
the following types:
(1) Securities of the same organization acquired by reason of
action initiated by the organization or any successor, related, or
acquiring organization, excluding any acquired by exercise of
purchase options.
(2) Securities of another organization acquired as a result of a
merger, consolidation, reorganization, or other distribution by the
organization or any successor, related, or acquiring organization.
(3) Securities of the same organization acquired as a result of a
plan of reinvestment.
(b) Distributions in cash before death with respect to a described
security are not part of the transfer.
SEC. 34. Section 21133 of the Probate Code is amended to read:
21133. A recipient of an at-death transfer of a specific gift has
a right to the property specifically given, to the extent the
property is owned by the transferor at the time the gift takes effect
in possession or enjoyment, and all of the following:
(a) Any balance of the purchase price (together with any security
agreement) owing from a purchaser to the transferor at the time the
gift takes effect in possession or enjoyment by reason of sale of the
property.
(b) Any amount of an eminent domain award for the taking of the
property unpaid at the time the gift takes effect in possession or
enjoyment.
(c) Any proceeds unpaid at the time the gift takes effect in
possession or enjoyment on fire or casualty insurance on or other
recovery for injury to the property.
(d) Property owned by the transferor at the time the gift takes
effect in possession or enjoyment and acquired as a result of
foreclosure, or obtained in lieu of foreclosure, of the security
interest for a specifically given obligation.
(e) Real or tangible personal property owned by the transferor at
the time the gift takes effect in possession or enjoyment that the
transferor acquired as a replacement for specifically given real or
tangible personal property.
SEC. 35. Section 21134 of the Probate Code is amended to read:
21134. (a) Except as otherwise provided in this section, if
after the execution of the instrument of gift specifically
given property is sold or mortgaged by a conservator or by an agent
acting within the authority of a durable power of attorney for an
incapacitated principal, the transferee of the specific gift has the
right to a general pecuniary gift equal to the net sale price of, or
the amount of the unpaid loan on, the property.
(b) Except as otherwise provided in this section, if an eminent
domain award for the taking of specifically given property is paid to
a conservator or to an agent acting within the authority of a
durable power of attorney for an incapacitated principal, or if the
proceeds on fire or casualty insurance on, or recovery for injury to,
specifically gifted property are paid to a conservator or to an
agent acting within the authority of a durable power of attorney for
an incapacitated principal, the recipient of the specific gift has
the right to a general pecuniary gift equal to the eminent domain
award or the insurance proceeds or recovery.
(c) For the purpose of the references in this section to a
conservator, this section does not apply if, after the sale,
mortgage, condemnation, fire, or casualty, or recovery, the
conservatorship is terminated and the transferor survives the
termination by one year.
(d) For the purpose of the references in this section to an agent
acting with the authority of a durable power of attorney for an
incapacitated principal, (1) "incapacitated principal" means a
principal who is an incapacitated person, (2) no adjudication of
incapacity before death is necessary, and (3) the acts of an agent
within the authority of a durable power of attorney are presumed to
be for an incapacitated principal.
(e) The right of the transferee of the specific gift under this
section shall be reduced by any right the transferee has under
Section 21133.
SEC. 36. Section 21135 of the Probate Code is amended to read:
21135. (a) Property given by a transferor during his or her
lifetime to a person is treated as a satisfaction of an at-death
transfer to that person in whole or in part only if one of the
following conditions is satisfied:
(1) The instrument provides for deduction of the lifetime gift
from the at-death transfer.
(2) The transferor declares in a contemporaneous writing that the
gift is in satisfaction of the at-death transfer or that its value is
to be deducted from the value of the at-death transfer.
(3) The transferee acknowledges in writing that the gift is in
satisfaction of the at-death transfer or that its value is to be
deducted from the value of the at-death transfer.
(4) The property given is the same property that is the
subject of a specific gift of that property to
that person.
(b) Subject to subdivision (c), for the purpose of partial
satisfaction, property given during lifetime is valued as of the time
the transferee came into possession or enjoyment of the property or
as of the time of death of the transferor, whichever occurs first.
(c) If the value of the gift is expressed in the contemporaneous
writing of the transferor, or in an acknowledgment of the transferee
made contemporaneously with the gift, that value is conclusive in the
division and distribution of the estate.
(d) If the transferee fails to survive the transferor, the gift is
treated as a full or partial satisfaction of the gift, as
appropriate the case may be , in applying
Sections 21110 and 21111 unless the transferor's contemporaneous
writing provides otherwise.
SEC. 37. Section 21136 of the Probate Code is repealed.
SEC. 38. Section 21137 of the Probate Code is repealed.
SEC. 39. Section 21138 of the Probate Code is repealed.
SEC. 40. Section 21139 of the Probate Code is amended to read:
21139. The rules stated in Sections 21133 to 21135, inclusive,
are not exhaustive, and nothing in those sections is intended to
increase the incidence of ademption under the law of this state.
SEC. 41. Section 21140 of the Probate Code is amended to read:
21140. This part applies to all instruments, regardless of when
they were executed.