THE RISE OF THE REVOCABLE TRUST IN CALIFORNIA

“NOTHING SAYS FUN LIKE PROBATE”

— Probate Attorneys of San Diego

I. SYNOPSIS

Fifty years ago, in 1973, when “Tie a Yellow Ribbon ‘Round the Old Oak Tree” topped Billboard’s annual list of the top 100 songs,01 the California State Bar (“State Bar”) officially refused to recommend replacing the California Probate Code with the Uniform Probate Code (“UPC”).02 Instead of recommending the adoption of the UPC, the State Bar proposed the adoption of statutes purportedly aimed at streamlining the California probate administration process. The proposed statutes became the Independent Administration of Estates Act (“IAEA”), now set forth in Probate Code sections 10400 through 10591.03

In the half-century since 1973, most California attorneys have gradually but fully moved away from wills and the California probate process and have embraced the revocable trust as the dominant lawyer-directed estate planning method for California residents. Lawyers and clients have adopted the revocable trust to avoid the perceived delay, publicity, and expense of California’s formal probate system. As noted in the California Trusts and Estates Quarterly (“Quarterly”) in 2007, “The problem is probate. Probate takes so long and costs so much that competent estate planning attorneys believe they must recommend trusts to protect their clients’ families from unnecessary delay and expense.”04

This article traces the history of California’s continued refusal to adopt the UPC and other less-formal probate administration procedures, and it explores the parallel expansion in the use of the revocable trust. It focuses on four major attempts to eliminate or reform California’s?formal probate system, each of which was rejected while, at the same time, the use of revocable trusts skyrocketed.

The authors’ discovery of the history of California’s repeated rejection of efforts to reform probate administration has led to spirited discussions regarding the benefits and burdens of the revocable trust as opposed to formal probate and/or elective probate. Nevertheless, the authors have attempted in this article to present the history of attempts to reform California’s probate system in a relatively dispassionate manner, with a few editorial comments. In addition, questions posed at the end of the article may suggest a need for further evaluation.

The article concerns itself with the concept of the revocable trust as a tool for avoidance of probate administration. The article does not address irrevocable trusts of any kind.

The article quotes extensively from previous articles in the Quarterly because the history is best illuminated through the eyes of the people who observed the developments as they happened. For the same reason, this article refers extensively to the Minutes of various meetings held by the Executive Committee of the Probate and Trust Section of the State Bar (“EXCOMM”) and by EXCOMM’s successor, the Trusts and Estates Executive Committee of the State Bar, which is now the Trusts and Estates Executive Committee of the California Lawyers Association (“TEXCOM”).

Given that the growth of the use of the revocable trust has been driven by the public’s desire to avoid probate, it is illuminating that EXCOMM (which featured the word “probate” in its formal title) changed its name to TEXCOM in 2002, at least in part because, “[the word] ‘probate’ connotes to many members of the public a negative image of our profession.”05

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