Depew v. Carmody (In re Flores)

316 Cal.Rptr.3d 843

ESTATE OF Robert Allen FLORES, Deceased.

Brenda Depew, as Administrator, etc., Petitioner,

v.Donald Carmody, Objector and Appellant;

American Research Bureau, Inc., Claimant and Respondent.

B320383

Court of Appeal,

Second District, Division 3.

Filed January 2, 2024

APPEAL from an order of the Superior Court of Los Angeles County, Ana Maria Luna, Judge. Affirmed. (Los Angeles County Super. Ct. No. 18STPB08481)

Jeff Klink, Sacramento, for Objector and Appellant.

Augustine and Seymour and Michael Augustine, Alhambra, for Claimant and Respondent.

ADAMS, J.

When an heir-hunter firm informed appellant Donald Carmody he was the heir of a nephew he never knew existed, he thought it was a scam. He assigned any rights he might have in the nephew’s estate to his brother, John Carmody, believing any such rights were worthless.¹ However, the estate had value. John filed a petition under Probate Code section 11700 for determination of entitlement to distribution of the nephew’s estate.² He obtained a determination that he and Donald were the nephew’s heirs, each entitled to a 50 percent share of the estate. John died before the request for a final distribution order was submitted to the court. When the administrator of the nephew’s estate sought a final distribution order that would take into account Donald’s assignment of his rights to John, Donald objected, claiming the prior order determining entitlement to distribution was final, binding, and prohibited the court from recognizing his prior assignment of his interest to John. The court rejected this claim.

We conclude the trial court properly gave effect to Donald’s assignment of his interest in the estate to John. John’s rights as an assignee were not raised or litigated in the section 11700 proceeding, which was limited to a determination of heirship. John did not forfeit or waive his rights as an assignee by failing to assert those rights in the section 11700 proceeding, or by failing to file a statement of interest. We therefore affirm the trial court judgment.

FACTUAL AND PROCEDURAL BACKGROUND

On September 2, 2012, Robert Allen Flores (Decedent) died intestate. He was not survived by a spouse, registered domestic partner, children, parents, or siblings.

In September 2018, American Research Bureau, Inc. (ARB), an "heir-hunter" firm, contacted brothers John and Donald to inform them that they were Decedent’s maternal uncles. John and Donald were therefore Decedent’s heirs, and ARB offered to work with them in seeking a portion of the estate. ARB sent Donald a copy of a 1930 federal census record reflecting that John and Donald’s father had a first wife prior to marrying their mother. ARB informed Donald that his father’s first wife was the Decedent’s grandmother. Donald was skeptical. Neither John nor Donald ever knew that they had a half sister—Decedent’s mother. Donald told John he thought they were being " ‘scammed.’ " In e-mail correspondence, ARB assured Donald that ARB was "not a scam," and added: "If you are still not interested in receiving your portion of the estate, we can work with you so that you can assign your share to your brother if you wish."

In October 2018, John told Donald that he planned to " ‘put in’ … for the estate of robert flores" because he "could use some pesos." That month, John signed an agreement assigning to ARB one-fourth of any interest he might have in Decedent’s estate. In November 2018, ARB e-mailed Donald again to inform him that it was "moving forward in this matter on behalf of your brother John," and asked if Donald wanted to be included in the proceeding with ARB’s assistance. Donald reiterated that he believed ARB might be "running a scam" and that "time will tell." However, he also had "no problem assigning [his] share of this ‘estate’ to [his] brother." ARB’s attorney prepared an assignment and sent it to Donald. In December 2018, Donald signed an "Assignment of Interest in Estate" stating: "I, DONALD D. CARMODY, hereby grant, transfer and assign all of my right, title, and interest in the above referenced estate to John L. Carmody, and hereby authorize and direct the Administrator of said estate to give my share and make payment to John L. Carmody of any interest I may have in said estate."

Petitions for probate of Decedent’s estate

Meanwhile, in September 2018, Patricia McCluskey filed a petition requesting that the probate court appoint her as administrator of Decedent’s estate. McCluskey alleged she was Decedent’s first cousin, once removed, and that she and four alleged second cousins were Decedent’s heirs-at-law and therefore entitled to the estate. McCluskey did not identify John or Donald as potential heirs.

In January 2019, John filed objections to McCluskey’s petition on the basis that he, as a maternal uncle, was more closely related to Decedent and was entitled to inherit Decedent’s estate to the exclusion of McCluskey and the alleged second cousins listed in her petition. Around the same time, John filed a competing petition for letters of administration nominating Brenda Depew as the administrator of Decedent’s estate. His petition identified Donald as Decedent’s other living maternal uncle.

In February 2019, the court denied McCluskey’s petition and granted John’s petition. The court issued letters of administration appointing Depew as the administrator of Decedent’s estate.

In July 2019, John filed a "Petition to Determine Entitlement to Estate Distribution [Probate Code § 11700]." He listed himself and Donald as Decedent’s sole heirs-at-law and asserted they were each entitled to half of the estate. The petition did not reference the assignment from Donald to John or the assignment from John to ARB. No other person filed a statement of interest asserting entitlement to distribution of Decedent’s estate or objecting to John’s petition. The court granted the petition and, in October 2019, entered an "Order Determining Entitlement to Estate Distribution." The order found that "[a]ll notices have been duly given as required by law," declared that John and Donald were the "heirs-at-law of the decedent," and found each was entitled to a 50 percent interest in the estate.

In January 2021, Depew filed a "First and Final Account and Report of Administrator; Petition for Statutory Commissions; for Statutory and Extraordinary Attorneys’ Fees; and for Final Distribution." Depew proposed a distribution of the balance of the estate, after payment of all outstanding fees and claims, to John and Donald, "each as to a 50% interest."

John’s estate

John died in August 2020. In his will, he named his stepdaughters Kara Masteller and Dawn Bailey as beneficiaries of his estate, and Masteller as the executor.

In April 2021, Donald’s attorney contacted Masteller and Bailey by letter, "for the purpose of facilitating distribution directly to Don of his 50% interest in the [Decedent’s estate]." Counsel indicated Donald had advised him of "his agreement with [John], … whereby John was to receive both John’s and Don’s interest in [Decedent’s estate], and then pay over Don’s interest when [Don] arrived back from Thailand and was thus in a better position to receive the funds and deposit those to his bank." The letter stated it appeared the administrator of Decedent’s estate had not been informed of John’s death, or that "John had undertaken to receive Don’s interest as a voluntary trustee."

Donald’s attorney proposed that Masteller, Bailey, and Donald sign and submit declarations pursuant to section 13107, seeking an order from the probate court that it "pay directly to each of [them] the share otherwise due John .… And Don will also receive his share directly, as requested in the Petition already filed …." The letter advised that regardless of whether Masteller and Bailey accepted counsel’s suggestion, "Don has directed me to ensure that he receives distribution of his share directly from [Decedent’s estate]."

In May 2021, Masteller filed a notice of "Assignment of Interest in Estate." She attached copies of Donald’s assignment of his interest in Decedent’s estate to John and John’s will. Soon after, the Superior Court for Yolo County issued letters testamentary appointing Masteller the executor of John’s estate.

In May 2021, Depew filed a "Supplement to First and Final Account and Report of Administrator; Petition For Statutory Commissions; For Statutory and Extraordinary Attorneys’ Fees; and For Final Distribution." The supplement indicated that subsequent to filing the initial "First and Final Account," Depew learned that Donald had assigned his interest in Decedent’s estate to John; John had post-deceased Decedent; and John left his entire estate to Masteller and Bailey. Depew therefore stated: "Since Donald D. Carmody has assigned his entire interest in the estate to his brother John L. Carmody, and since John L. Carmody left a Will leaving his entire estate to Kara Masteller and Dawn Bailey, Petitioner proposes that 100% of the estate residue should be distributed" to Masteller.³

Donald’s objections

Donald objected to Depew’s supplemental filing. Donald primarily argued that the court’s October 2019 order was conclusive as to the persons entitled to distribution of Decedent’s estate, therefore he was entitled to half the estate. Donald further argued his assignment to John was a conveyance in trust, because John told Donald by phone in July 2020 that he never intended to keep all of the money, and John had reassured Donald that he would split the funds equally with Donald if they were all distributed to John. Finally, Donald contended John waived the assignment by not identifying it in his July 2019 section 11700 petition.⁴

In a reply to Donald’s objection, Masteller argued Donald’s assignment of his interest in the estate to John was valid and was not waived because it was not before the court in the prior proceeding. She further argued the October 2019 order was only conclusive and binding "as to any claims...