Attorney Fee Award Under Trust Law Must Be Reasonable & Appropriate for the Benefit of the Trust

Attorney Fee Award Test
Attorney Fee Award Must Be in Line With The Size of the Trust

Attorney Fee Awards in Living Trust Litigation:

Part Two


This is paralegal research I am doing on a case where the attorneys are attempting to completely deplete the trust with attorney fee awards. My argument will be that the attorneys cannot totally deplete the assets with a massive living trust litigation attorney fee award. In probate court and living trust litigation always keep working on your grounds to disqualify attorney fee awards with current case law. 

Long-established principles of trust law impose a double-barreled reasonableness requirement: the fee award must be reasonable in amount and reasonably necessary to the conduct of the litigation, but it also must be reasonable and appropriate for the benefit of the trust. We remand for the trial court to review the evidence and to assess a fee reimbursement in accordance with these dual criteria. Donahue v. Donahue, 182 Cal. App. 4th 259 (Cal. Ct. App. 2010)


Donahue is My Leading Case on Attorney Fee Awards in Living Trust Litigation


Donahue involved unconscionable billing by attorneys at Jones Day and other law firms. Appellant sought limited discovery on the amount of the attorney fee award and also to appoint a referee pursuant to Code of Civil Procedure section 639 to review the attorney fee award and make a recommendation to the court. 

Trustees have a duty “to administer the trust solely in the interest of the beneficiaries.” (Prob.Code, § 16002. subd. (a); see Schwartz v. Labow (2008) 164 Cal.App.4th 417 (Schwartz ) [trustee imprudently spent $1.3 million in trust funds to obtain partially collectible judgment of $700,000].) They should incur and pay expenses, including legal expenses, which are “reasonable” in amount and “appropriate” to the “purposes and circumstances of the trust.” (Rest.3d Trust, § 88, p. 256; see also Prob.Code § 15684.) To recover fees and costs, trustees must subjectively believe the expense was necessary or appropriate to carry out the trust’s purposes, and they must show their beliefs were objectively reasonable. (See Conservatorship of Lefkowitz (1996) 50 Cal.App .4th 1310, 1314 (Lefkowitz ).)

We apply an abuse of discretion standard to the trial court’s decision granting Patrick’s fee requests payable from the trust’s assets. (Kasperbauer, supra, 171 Cal.App.4th at p. 234.) There are limits to the scope of our deference, however. “When the record is unclear whether the trial court’s award of attorney fees is consistent with the applicable legal principles, we may reverse the award and remand the case to the trial court for further consideration and amplification of its reasoning.  “A trial court’s award of attorney fees must be able to be rationalized to be affirmed on appeal.” (Gorman v. Tassajara Development Corp. (2009) 178 Cal .App.4th 44, 101 (Gorman ).)


Judges Are Experts on Attorney Fee Awards


It is true that judges themselves are deemed to be experts on the value of legal services, and may rely on their own experience about reasonable and proper fees, without resort to expert testimony. “ ‘In many cases the trial court will be aware of the nature and extent of the attorney’s services from its observation of the trial proceedings and the pretrial and discovery proceedings reflected in the file.’ “ (Martino v. Denevi (1986) 182 Cal.App.3d 553, 559 .)


By Dean McAdams

Born a poor peckerwood in a Tujunga holler, Dean overeducated himself beyond his social station to end up a retired paralegal in the coastal paradise of West L.A.