BILL ANALYSIS Ó SENATE JUDICIARY COMMITTEE Senator Hannah-Beth Jackson, Chair 2013-2014 Regular Session AB 1520 (Gatto) As Amended May 23, 2014 Hearing Date: June 10, 2014 Fiscal: No Urgency: No TMW SUBJECT Guardians Ad Litem: Animals DESCRIPTION This bill would authorize a court to appoint a guardian ad litem to represent the interests of an animal, who is the subject of a pet trust, if the court determines that representation of the animal's interest otherwise would be inadequate. This bill would also authorize the court to award payment of the reasonable expenses of the guardian ad litem either rout of the trust or another source. BACKGROUND According to the 2013-2014 American Pet Products Association's National Pet Owners Survey, 68 percent of United States households own a pet, which equates to approximately 82.5 million homes. Increasingly, pet owners are seeking to ensure that their pets are cared for after the owner's death or disability. Thus, informal arrangements with family or friends have been made for the care of such animals. Some have ventured to include pets in their wills, while others have created "pet trusts" that set aside money for the care of the pets in the event of the owner's death or disability. For example, famed real estate and hotel mogul Leona Helmsley left a trust of $12 million for the care of her pet dog, Trouble. Another lesser known pet owner from Maryland willed some $400,000 plus a house to the three stray dogs that he adopted. In those circumstances, the trustee or executor is expected to pay a caretaker to ensure that the pets are housed, (more) AB 1520 (Gatto) Page 2 of ? fed, and maintained as provided in the trust or will. Under existing law, any person interested in the welfare of a pet, or any nonprofit charitable organization principally involved in the care of animals, may petition the court regarding the pet trust or the trustee's powers or administration of the trust. This bill would also provide that the court, on its own motion, or upon the petition of the trustee or any person interested in the welfare of the pet or any appropriate nonprofit charitable organization, could appoint a guardian ad litem to represent the interests of the pet if the court determines that the representation of the pet's interest otherwise would be inadequate. CHANGES TO EXISTING LAW 1. Existing law authorizes the court, on its own motion or on request of a personal representative, guardian, conservator, trustee, or other interested person, to appoint a guardian ad litem at any stage of a proceeding to represent the interest of any of the following persons, if the court determines that representation of the interest otherwise would be inadequate: a minor; an incapacitated person; an unborn person; an unascertained person; a person whose identity or address is unknown; and a designated class of persons who are not ascertained or are not in being. (Prob. Code Sec. 1003(a).) This bill would also authorize the court, on its own motion or on request of a trustee or other person interested in the welfare of the animal or an animal care nonprofit organization, to appoint a guardian ad litem to represent the interest of an animal for which a trust has been established, if the court determines that representation of the interest otherwise would be inadequate. 2. Existing law provides for the creation of a trust for the care of an animal as follows: a trust for the care of a designated domestic or pet animal is valid and terminates when no living animal is covered by the trust; the governing instrument shall be liberally construed in order to bring the transfer within the normal rules for trusts, to presume against the honorary nature of the AB 1520 (Gatto) Page 3 of ? disposition, and to carry out the general intent of the trustor; extrinsic evidence is admissible in determining the intent of the trustor; the trust principal or income shall not be converted to the trustee's use or for any purpose other than for the benefit of the covered animal; upon termination of the trust, the trustee shall transfer the unexpended trust property, as specified; the intended purpose of the trust principal or income may be enforced by a person designated by the trust or, if none is designated, by a person appointed by the court upon application; any person interested in the welfare of the animal or any nonprofit charitable organization that has as its principal activity the care of animals may petition the court regarding the trust; if the trust instrument does not name a trustee or no trustee or successor trustee is willing or able to serve, the court is required to appoint a trustee to carry out the intended use of the trust property; a court may order the transfer of the trust property to a court-appointed trustee, if it is required to ensure that the intended use is carried out and if a successor trustee is not designated in the trust instrument or if no designated successor trustee agrees to serve or is able to serve; a court may make all other orders necessary to carry out the trustor's intent; trust accountings must be provided to the beneficiaries who would be entitled to distribution if the animal were then deceased and to any nonprofit charitable corporation that has as its principal activity the care of animals and that has requested these accountings in writing. However, if the value of the assets in the trust does not exceed $40,000, no filing, report, registration, periodic accounting, separate maintenance of funds, appointment, or fee is required by reason of the existence of the fiduciary relationship of the trustee, unless ordered by the court or required by the trust instrument; any beneficiary, any person designated by the trust instrument or the court to enforce the trust, or any nonprofit charitable corporation that has as its principal activity the care of animals may, upon reasonable request, inspect the animal, the premises where the animal is maintained, or the books and records of the trust; and AB 1520 (Gatto) Page 4 of ? "animal" is defined to mean a domestic or pet animal for the benefit of which a trust has been established. (Prob. Code Sec. 15212.) This bill would authorize the court, on its own motion or on the request of the trustee or any person or organization authorized to petition the court regarding the trust, to appoint a guardian ad litem to represent the interest of the animal if the court determines that representation otherwise would be inadequate. This bill would provide that the reasonable expenses of the guardian ad litem, including compensation and attorney's fees, shall be determined by the court and paid as the court orders, either out of the trust or from another source as the court orders. COMMENT 1. Stated need for the bill The author writes: Current law does not allow for the appointment of a person to represent the best interest of an animal that is the subject of a pet trust. This bill would allow for the appointment of such a person [if] the court sees fit. 2. Appointment of guardian ad litem to protect the pet's interest in trust California law provides for the creation of a pet trust to ensure the continued care of an animal after the owner's death and authorizes an interested person or any nonprofit charitable organization principally involved in the care of animals to petition the court with respect to the trustee's administration of the pet trust. However, existing law does not currently provide for the appointment of a guardian ad litem to represent the pet's interest in a legal proceeding of the pet trust. According to the author, this bill is necessary to allow for the appointment of a person to represent the best interest of an animal that is the subject of a pet trust. The Humane Society of the United States, in support, asserts that "[p]ets are routinely considered part of [a] person's family. The Humane Society of the United States encourages AB 1520 (Gatto) Page 5 of ? responsible pet owners to ensure that their beloved pet will continue to receive the care they provided if something unexpected were to happen. AB 1520 provides a valuable and needed safety net for pets and other animals if that message is not heard or, despite an individual's best intentions, the plans fall short." A pet owner or person may establish a trust for the continued care of the animal after the death of the owner. At times, the trust may or may not specify a person to act as the trustee of the pet trust who would be responsible for administering the trust funds for the care of the pet. In those cases, a court is authorized to appoint a trustee for this purpose. However, in cases where a person who is interested in the well-being of the animal or an animal care organization is concerned that the trustee may not act in the best interest of the animal, this bill would authorize the court to appoint a guardian ad litem to represent the best interests of the animal in the trust proceedings. Arguably, allowing a person, who has knowledge of the pet and the owner's intentions with respect to the pet's care or an animal care organization with experience in the particular needs of the animal, to represent the animal's legal interests would better serve the trustor's intent to provide proper care for the pet. Staff notes that there are two different methods and four different court forms to request an appointment of a guardian ad litem under California law. (See Code Civ. Proc. Sec. 372; Prob. Code Sec. 1003; Judicial Council Forms CIV-010, FL-935, DE-350, GC-100.) However, the recent amendments to this bill, which add pet trust guardian ad litem to the list of persons for whom the court may appoint a guardian ad litem in Probate Code proceedings, clarify the appropriate procedure the court or authorized person would use to appoint a guardian ad litem for a pet regarding a pet trust proceeding. 3. Opposition concerns The California State Association of Public Administrators, Public Guardians, and Public Conservators (Public Guardians), in opposition, argue that public guardians in most counties are already burdened with heavy caseloads and inadequate funding. Further, "in many cases when there is a dispute among parties in trust or probate cases the court looks to public guardians to serve as an arbitrator to resolve disputes. . . [Public guardians] cannot spend valuable time and resources serving as AB 1520 (Gatto) Page 6 of ? guardian ad litem for animal trusts. Rather, they need to reserve their limited time and resources caring for people in dire need of their services." Accordingly, the Public Guardians request that the bill be amended to prohibit a court from appointing a public guardian to serve in the ad litem role in pet trusts. The Animal Council (TAC), also in opposition, argues that "there is no proper legal basis for appointment of guardians ad litem for animals within the California Probate Code. . . . Since Section 15212 already provides procedures for oversight of the trust and the animal, it is difficult to understand the need for establishing unprecedented legal rights for any class of animals within the Probate Code." TAC further argues that the author's assertion that "the status of animals is inherently more than property as evidenced by animals being able to be beneficiaries of trusts pursuant to legislation" is misleading and incorrect in a legal context because animals were not intended by the Legislature when enacting the pet trust statute to make animals beneficiaries of a pet trust. On this point, TAC argues "[t]here is a legal difference between being a 'beneficiary' in a legal sense and that of animals as 'property' for which a trust is established for its care and maintenance. Inanimate property can also be maintained by a trustor's designation and assets but does not become a 'beneficiary' itself. Under existing law animals are property within a framework that allows their legal owners or other provided by statute to protect their interests within the judicial system. Animals for which a trust has been established may be 'beneficiaries' in vernacular usage, but the statutory enforceability of the trust does not confer the legal status of 'beneficiary;' on the animals. To enact law that suggests this invites confusion, expense and unnecessarily time consuming use of the judicial system." To address the opposition concerns, the author has requested to amend this bill in Committee to clarify that a guardian ad litem can only be appointed in a pet trust proceeding, but a public guardian cannot be appointed for this purpose. Author's Amendments : 1. On page 2, in line 16, remove and replace "The" with "(1) For purposes of Section 15212, the" 2. On page 2, between lines 20 and 21, insert "(2) The public guardian shall not be appointed as a guardian ad litem for purposes of this subdivision." AB 1520 (Gatto) Page 7 of ? 3. On page 4, in line 19, after "(i)" insert "(1)" 4. On page 4, between lines 28 and 29, insert "(2) The public guardian shall not be appointed as a guardian ad litem for purposes of this section." Support : State Humane Association of California; The Humane Society of the United States Opposition : California State Association of Public Administrators, Public Guardians, and Public Conservators; The Animal Council HISTORY Source : Author Related Pending Legislation : None Known Prior Legislation : SB 685 (Yee, Ch. 168, Stats. 2008) repealed prior law on trusts for domesticated or pet animals and enacted more detailed provisions for the creation and enforcement of pet trusts. Prior Vote : Assembly Floor (Ayes 72, Noes 0) Assembly Committee on Judiciary (Ayes 10, Noes 0) **************