BILL ANALYSIS
SENATE JUDICIARY COMMITTEE
Senator Ellen M. Corbett, Chair
2009-2010 Regular Session
SB 1041 (Harman)
As Introduced
Hearing Date: May 4, 2010
Fiscal: No
Urgency: No
TW:jd
SUBJECT
Hearsay Evidence: Wills and Revocable Trusts
DESCRIPTION
This bill would allow evidence at a hearing or trial of a
statement made by an unavailable declarant that he or she made
or did not make a revocable trust.
BACKGROUND
Under the hearsay rules of evidence, out-of-court statements
offered to prove the truth of the matter asserted are
inadmissible in court unless the actual declarant testifies or
the testimony fits into one of the categorical exceptions to the
rule. (Evid. Code Sec. 1200 et seq.) The general exclusion of
hearsay from evidence is premised on the notion that
out-of-court statements are inherently more unreliable than live
testimony. Specifically, hearsay statements are not made under
oath, the adverse party has no opportunity to cross-examine the
declarant, and the jury cannot observe the declarant's demeanor
while making the statements. (People v. Duarte (2000) 24
Cal.4th 603, 610.)
Courts developed categorical exceptions to the hearsay rule
because of the perception that certain statements are inherently
reliable despite the absence of direct testimony and because the
need for certain evidence outweighs the risks. (See Mathews,
Making the Crucial Connection: A Proposed Threat Hearsay
Exception, 27 Golden Gate U. Law Rev. 117 (1993).) For example,
statements made when the declarant knows he or she is about to
die or excited statements made without an opportunity to reflect
(more)
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are considered more believable because the declarant has neither
the motive nor the time to fabricate the statement. (Evid. Code
Sec. 1240 (spontaneous, contemporaneous, or dying declarations
as an exception to the hearsay rule).) In general, however,
hearsay is presumptively unreliable.
This bill, sponsored by the Conference of California Bar
Associations, would amend the Evidence Code to extend the
hearsay exception to a statement made by a declarant who is
unavailable as a witness that he or she has or has not
established a revocable trust, or has or has not revoked his or
her revocable trust, or that identifies his or her revocable
trust, or any amendment thereto.
CHANGES TO EXISTING LAW
Existing law provides that "hearsay evidence" is evidence of a
statement that was made other than by a witness while testifying
at a trial or hearing and that is offered to prove the truth of
the matter stated. Except as provided by law, hearsay evidence
is inadmissible. (Evid. Code Sec. 1200(a) and (b).)
Existing law provides exceptions to the hearsay rule, including
evidence of a statement made by a declarant who is unavailable
as a witness that he or she has or has not made a will. (Evid.
Code Sec. 1260.)
Existing law , for the purposes of the Evidence Code, provides
that "unavailable as a witness," means that the declarant is any
of the following:
(a) exempt or precluded on the ground of privilege
from testifying
concerning the matter to which his or her statement is
relevant;
(b) disqualified from testifying to the matter;
(c) dead or unable to attend or to testify at the
hearing because of then existing physical or mental illness
or infirmity;
(d) absent from the hearing and the court is unable to compel
his or her attendance by its process; or
(e) absent from the hearing and the proponent of his or her
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statement has exercised reasonable diligence but has been
unable to procure his or her attendance by the court's
process. (Evid. Code Sec. 240(a)(4).)
This bill would add to the existing hearsay rule exception that
evidence of a statement made by a declarant who is unavailable
as a witness that he or she has or has not established or
amended a revocable trust or evidence that identifies his or her
revocable trust or amendment thereto, is not made inadmissible
by the hearsay rule.
COMMENT
1. Stated need for the bill
The author writes:
Evidence Code [Section] 1260 establishes [an] exception for a
statement made by a declarant that he or she has or has not
made or revoked a will, or which identifies such a will. The
basis for the exception, of course, is that in most such
situations the declarant is dead and therefore unavailable to
testify.
In recent years, however, living trusts have become
increasingly common as a substitute for wills. However, there
is no corresponding exception to the hearsay evidence rule for
a statement made by a declarant that he or she has or has not
made or revoked a trust, or which identifies such a trust,
even though the same rationale for exception exists (i.e., the
fact that the declarant is very often dead and therefore
unavailable to testify).
In an era when many estate plans are contained in trusts
rather than in wills, it is important to the courts to have
available evidence as to the existence of a living trust and
to identify such a trust, if it does exist. Often the best
probative evidence is that of statements made by the decedent
while living. The existing law works well for wills, and its
expansion to include trusts will improve the conduct of trials
with regard to the estate plans of decedents.
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2. Revocable trusts serve as a will substitute
As explained in Restatement Third, Trusts Section 11, Comment b,
"the revocable trust serves as a will substitute with respect to
all or part of the settlor's estate and has as its primary
significance the determination of the persons who will receive
the trust property, and in what interests, at the settlor's
death. Therefore, the standards applicable to wills are also
applicable in determining whether a revocable trust is valid or
fails when later challenged by persons who would otherwise be
the settlor's successors in interest." The logic behind a
revocable trust being used as a will substitute is premised on
the standard for mental capacity to make or revoke a will.
In order to make a valid will, the individual must be competent.
Pursuant to Probate Code Section 6100.5, "[a]n individual is
not mentally competent to make a will if at the time of making
the will either of the following is true: (1) The individual
does not have sufficient mental capacity to be able to (A)
understand the nature of the testamentary act, (B) understand
and recollect the nature and situation of the individual's
property, or (C) remember and understand the individual's
relations to living descendants, spouse, and parents, and those
whose interests are affected by the will[; or] (2) The
individual suffers from a mental disorder with symptoms
including delusions or hallucinations, which delusions or
hallucinations result in the individual's devising property in a
way which, except for the existence of the delusions or
hallucinations, the individual would not have done."
Thus, if a person is competent to make a will or will substitute
but is unavailable to testify, hearsay evidence of the person's
statement about making or not making a will is sufficient to
qualify as evidence. Accordingly, this bill recognizes the
significance of a revocable trust as a satisfactory will
replacement and would make the necessary addition to provide for
the hearsay exception as it pertains to revocable trusts.
3. Suggested amendments to this bill will account for amendments
to revocable trusts
As introduced, this bill does not apply to amendments to
revocable trusts. The Executive Committee of the Trusts and
Estates Section of the State Bar (TEXCOM), a supporter of this
bill, addressed this issue as follows:
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Litigation over whether a person created or revoked an
amendment to a revocable trust or whether an amendment is the
decedent's is more likely to arise than litigation posing one
or more of these issues with respect to the revocable trust
itself. This is because revocable trusts are usually
comprehensive documents prepared by lawyers, and laypersons
much more often prepare their own trust amendments, which need
neither be witnessed nor notarized to be valid. Notably, the
definition of "will" in Probate Code Section 88 includes
"codicil," the instrument by which a testator amends his or
her will. The definition of "trust" in Probate Code Section
82 is extraordinarily comprehensive, but does not include
trust amendment. Accordingly, to ensure that the hearsay
exceptions applicable to wills and trusts are entirely
congruent, TEXCOM suggests that SB 1041 be amended to apply to
statements regarding both revocable trusts and amendments to
revocable trusts.
The sponsor agreed that evidence of amendments to revocable
trusts should be included as hearsay exceptions. As discussed
above, a revocable trust is a satisfactory will replacement. It
follows then that an amendment to a revocable trust would be the
replacement for a codicil to a will. Probate Code Section 88
defines a will to include codicils. As applied to the hearsay
exception, evidence of codicils is allowed as a hearsay
exception. Since amendments to revocable trusts function in the
same way as codicils, it is appropriate to add amendments to
revocable trusts to the list of testamentary documents falling
under the hearsay rule exception. For this reason, the author
has agreed to take the following amendments:
Suggested Amendments :
1. On page 2, line 1 strike "Evidence of a statement" and
insert "Except as provided in subdivision (b), evidence of
any of the following statements".
2. On page 2, line 2 strike "that he or she has or has not
made a will or established a revocable trust, or has or has
not revoked his or her will or revocable trust, or that
identifies his or her will or revocable trust,".
3. On page 2, line 5 strike "."
and insert ":
(1) That the declarant has or has not made a will or
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established or amended a revocable trust.
(2) That the declarant has or has not revoked his or her
will, revocable trust, or an amendment to a revocable
trust.
(3) That identifies the declarant's will, revocable trust,
or an amendment to a revocable trust."
4. The proposed Hearsay Exception compared to Federal Rules
Evidence Code Section 1260 was based on Federal Rules of
Evidence Rule 803(3) which provides for a hearsay exception when
the statement relates to the execution, revocation,
identification, or terms of the declarant's will. The Notes of
Advisory Committee on Rules state that the hearsay exception as
it applies to wills rests on practical grounds of necessity and
expediency rather than logic. The courts needed a quick and
easy way to determine a decedent's intent of transferring
property. Although the Federal Rules of Evidence have yet to
provide for a hearsay exception for revocable trusts, this bill
will allow California courts to consider evidence regarding
revocable trusts for the same purposes that evidence regarding
wills currently is used.
Support : The Executive Committee of the Trusts and Estates
Section of the State Bar; Judicial Council of California
Opposition : None Known
HISTORY
Source : Conference of California Bar Associations
Related Pending Legislation : AB 1723 (Lieu, 2010) adds an
additional exception to the hearsay rule for statements offered
against a party that has engaged in, or knowingly approved of,
wrongdoing that was intended to, and did, procure the
unavailability of the declarant as a witness.
Prior Legislation : AB 333 (Song, Wilson, Foran, Stanton,
Whetmore, Ch. 299, Stats. 1967) codified the Federal Rules of
Evidence pertaining to hearsay and hearsay exceptions under
California law.
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