Code Section Group

Probate Code - PROB

DIVISION 9. TRUST LAW [15000 - 19530]

  ( Division 9 enacted by Stats. 1990, Ch. 79. )

PART 8. PAYMENT OF CLAIMS, DEBTS, AND EXPENSES FROM REVOCABLE TRUST OF DECEASED SETTLOR [19000 - 19403]

  ( Part 8 added by Stats. 1991, Ch. 992, Sec. 3. )

CHAPTER 1. General Provisions [19000 - 19012]
  ( Chapter 1 added by Stats. 1991, Ch. 992, Sec. 3. )

19000.
  

As used in this part:

(a) “Claim” means a demand for payment for any of the following, whether due, not due, accrued or not accrued, or contingent, and whether liquidated or unliquidated:

(1) Liability of the deceased settlor, whether arising in contract, tort, or otherwise.

(2) Liability for taxes incurred before the deceased settlor’s death, whether assessed before or after the deceased settlor’s death, other than property taxes and assessments secured by real property liens.

(3) Liability for the funeral expenses of the deceased settlor.

(b) “Claim” does not include a dispute regarding title to specific property alleged to be included in the trust estate.

(c) “Creditor” means a person who may have a claim against the trust property.

(d) “Trust” means a trust described in Section 18200, or, if a portion of a trust, that portion that remained subject to the power of revocation at the deceased settlor’s death.

(e) “Deceased settlor” means a deceased person who, at the time of his or her death, held the power to revoke the trust in whole or in part.

(f) “Debts” means all claims, as defined in subdivision (a), all expenses of administration, and all other proper charges against the trust estate, including taxes.

(g) “Probate estate” means a decedent’s estate subject to administration pursuant to Division 7 (commencing with Section 7000).

(h) “Trust estate” means a decedent’s property, real and personal, that is titled in the name of the trustee of the deceased settlor’s trust or confirmed by order of the court to the trustee of the deceased settlor’s trust.

(Amended by Stats. 2015, Ch. 48, Sec. 1. (SB 785) Effective January 1, 2016.)

19001.
  

(a) Upon the death of a settlor, the property of the deceased settlor that was subject to the power of revocation at the time of the settlor’s death is subject to the claims of creditors of the deceased settlor’s probate estate and to the expenses of administration of the probate estate to the extent that the deceased settlor’s probate estate is inadequate to satisfy those claims and expenses.

(b) The deceased settlor, by appropriate direction in the trust instrument, may direct the priority of sources of payment of debts among subtrusts or other gifts established by the trust at the deceased settlor’s death. Notwithstanding this subdivision, no direction by the settlor shall alter the priority of payment, from whatever source, of the matters set forth in Section 11420 which shall be applied to the trust as it applies to a probate estate.

(Amended by Stats. 2015, Ch. 48, Sec. 2. (SB 785) Effective January 1, 2016.)

19002.
  

(a) Except as expressly provided, this part shall not be construed to affect the right of any creditor to recover from any revocable trust established by the deceased settlor.

(b) Nothing in this part shall be construed as a construction or alteration of any claims procedure set forth under Part 4 (commencing with Section 9000) of Division 7.

(Added by Stats. 1991, Ch. 992, Sec. 3.)

19003.
  

(a) At any time following the death of the settlor, and during the time that there has been no filing of a petition to administer the probate estate of the deceased settlor in this state of which the trustee has actual knowledge, the trustee may file with the court a proposed notice to creditors. Upon the court’s assignment of a proceeding number to the proposed notice, the trustee shall publish and serve notice to creditors of the deceased settlor in the form and within the time prescribed in Chapters 3 (commencing with Section 19040) and 4 (commencing with Section 19050). That action shall constitute notice to creditors of the requirements of this part.

(b) The filing shall be made with the superior court for the county in this state where the deceased settlor resided at the time of death, or if none, in any county in this state in which trust property was located at the time of the settlor’s death, or if none, in the county in this state that was the principal place of administration of the trust at the time of the settlor’s death.

(c) Nothing in subdivision (a) affects a notice or request to a public entity required by Chapter 7 (commencing with Section 19200).

(Amended by Stats. 2015, Ch. 48, Sec. 3. (SB 785) Effective January 1, 2016.)

19004.
  

If the trustee files, publishes, and serves notice as set forth in Section 19003, then:

(a) All claims against the trust shall be filed in the manner and within the time provided in this part.

(b) A claim that is not filed as provided in this part is barred from collection from trust assets.

(c) The holder of a claim may not maintain an action on the claim against the trust unless the claim is first filed as provided in this part.

(Added by Stats. 1991, Ch. 992, Sec. 3.)

19005.
  

The trustee may at any time pay, reject, or contest any claim against the deceased settlor or settle any claim by compromise, arbitration, or otherwise. The trustee may also file a petition in the manner set forth in Chapter 2 (commencing with Section 19020) to settle any claim.

(Added by Stats. 1991, Ch. 992, Sec. 3.)

19006.
  

(a) If a trustee of a trust established by the deceased settlor files, publishes, and serves notice as provided in Section 19003 the protection from creditors afforded that trustee and trust shall also be afforded to any other trusts established by the deceased settlor and the trustees and beneficiaries of those trusts.

(b) If the personal representative of the deceased settlor’s probate estate has published notice under Section 8120 and given notice of administration of the probate estate of the deceased settlor under Chapter 2 (commencing with Section 9050) of Part 4 of Division 7, the protection from creditors afforded the personal representative of the deceased settlor’s probate estate shall be afforded to the trustee and to the beneficiaries of the trust.

(c) In the event that, following the filing and publication of the notice set forth in Section 19003, there shall be commenced any proceeding under which a notice pursuant to Section 8120 is required to be published, then the trustee shall have a right of collection against that probate estate to recover the amount of any debts paid from trust assets that would otherwise have been satisfied (whether by law or by direction in the deceased settlor’s will or trust) by the property subject to probate proceedings.

(Amended by Stats. 2015, Ch. 48, Sec. 4. (SB 785) Effective January 1, 2016.)

19007.
  

Nothing in this part shall determine the liability of any trust established by the deceased settlor as against any other trust established by that settlor, except to the extent that the trustee of the other trust shall file, publish, and serve the notice specified in Section 19003 and thereafter seek a determination of relative liability pursuant to Chapter 2 (commencing with Section 19020).

(Added by Stats. 1991, Ch. 992, Sec. 3.)

19008.
  

If there is no proceeding to administer the probate estate of the deceased settlor, and if the trustee does not file a proposed notice to creditors pursuant to Section 19003 and does not publish notice to creditors pursuant to Chapter 3 (commencing with Section 19040), then the liability of the trust to any creditor of the deceased settlor shall be as otherwise provided by law.

(Amended by Stats. 2015, Ch. 48, Sec. 5. (SB 785) Effective January 1, 2016.)

19009.
  

Nothing in this part shall be construed to permit or require disclosure of the existence of the trust or the contents of any of its provisions to any creditor or beneficiary except as that creditor or beneficiary may otherwise be entitled to that information.

(Added by Stats. 1991, Ch. 992, Sec. 3.)

19010.
  

Nothing in this part imposes any duty on the trustee to initiate the notice proceeding set forth in Section 19003, and the trustee is not liable for failure to initiate the proceeding under this part.

(Added by Stats. 1991, Ch. 992, Sec. 3.)

19011.
  

(a) The Judicial Council may prescribe the form and contents of the petition, notice, claim form, and allowance or rejection form to be used pursuant to this part. The allowance or rejection form may be part of the claim form.

(b) Any claim form adopted by the Judicial Council shall inform the creditor that the claim must be filed with the court and a copy delivered pursuant to Section 1215 to the trustee. The claim form shall include a proof of delivery of a copy of the claim to the trustee, which may be completed by the claimant.

(Amended by Stats. 2017, Ch. 319, Sec. 99. (AB 976) Effective January 1, 2018.)

19012.
  

(a) This part applies to claims against any deceased settlor who dies on or after January 1, 1992.

(b) The applicable law in effect before January 1, 1992, continues to apply to claims against any deceased settlor who dies before January 1, 1992.

(Added by Stats. 1991, Ch. 992, Sec. 3.)

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