[Opinion certified for partial publication.
FACTUAL AND PROCEDURAL BACKGROUND
Edward Goodman, founder of Goodman Lumber Company (GLC), died on September 2, 1990. Edward left most of his approximately $100-million-value estate to his two daughters, Joan Zimmerman and Gloria Clumeck.
Edward founded GLC in 1949 and it became one of the nation's most successful building supply businesses. He transferred ownership of the company to a family limited partnership in 1983. The partnership was also referred to as GLC. According to Edward's plan, Charles's company, Charles Goodman, Inc., was the general partner of the partnership. The limited partners were as follows: Charles, with a 40 percent interest; and Joan, Gloria and the Goodman 1981 revocable trust, each with a 20 percent interest.
In addition, Edward established a corporation known as Discount Builders Supply (DBS) and each of the three children received a 33 1/3 percent interest in this company. DBS operated a retail store but GLC handled all the purchasing, payroll, accounting and other administration for DBS.
When Edward became less involved in the business in the mid-1970's he placed Charles in charge of the daily operations of GLC as its chief executive officer. Charles also served as the general manager of DBS.
Edward continued to make all principal financial decisions for GLC. At the year-end meeting, Edward decided how the company's profits would be distributed. Through 1988, Edward decided the salary for Charles and himself, the employee bonuses, the profit sharing plan contributions, the charitable contributions and the amount of the company's rent. Edward set Charles's annual compensation from GLC and DBS for 1986 through 1989 at $1 million or more. Edward also determined the extent to which each of his children and their families would receive nonsalary benefits from GLC. Joan and Gloria were not invited to the year-end meetings as Edward did not want their participation in financial decisions.
A cross-complaint filed by Joan and Gloria against Charles and Charles Goodman, Inc., alleged that Charles breached the partnership agreement and
The trial court granted judgment in favor of Joan and Gloria individually and Joan in her representative capacities, and against Charles on all three actions filed by him, and in favor of Charles and against Joan and Gloria on the cross-complaint filed by them.
Charles has appealed from the judgment entered against him, but he has limited his appeal to the matter of testamentary capacity. Joan and Gloria have appealed from that portion of the judgment which denies them relief on their cross-complaint.
The evidence showed that Edward was a very strong-willed, opinionated, decisive man. He became angry if someone crossed him. At various times each of the children was in and out of his favor. Marion Goodman, mother of Charles, Joan and Gloria and Edward's wife of 42 years, died in 1982. During her lifetime, Marion had been able to soothe tensions among the children. Edward was very concerned that upon her passing the family would fall apart. Family harmony was important to Edward.
Edward was upset to learn that Charles and his wife, Barbara, had mistreated Joan during the 1984 Hawaii family vacation. Joan had written Edward a letter following that vacation citing specific instances of mistreatment. Edward showed the letter to several people, including Charles who made no effort to resolve the issue with Joan. Edward also asked Gloria, the eldest child, to do something about the family disharmony. Gloria set up a meeting with all family members and a close family friend, Edward's doctor, Martin Brotman, who was aware of the problems. When Charles said he would not attend, the meeting was cancelled.
Subsequently there was a brief period during which Joan and Edward did not communicate. During this time Gloria also fell out of Edward's favor
In 1987, Edward brought Joan back into the family business. Shortly thereafter, at Edward's apartment, Barbara and Edward became involved in a heated argument. The housekeeper testified that Edward and Barbara screamed at each other about the business. Edward told her that she and Charles could not run his business. Edward later described the confrontation to Gary, stating that Barbara should not tell him how to divide up his company. He stated that he was putting Joan back into the business because he was unhappy with the way Charles and Barbara had treated her in Hawaii.
Charles went to Edward's apartment in November 1989 for a meeting. A heated argument ensued when Charles questioned his removal as trustee of Edward's trust. Edward said he removed him because he was secretive and untrustworthy. The confrontation took place approximately 10 months before Edward's death. Charles did not speak to his father again after that meeting.
In January 1990, Edward informed his attorney, Richard Greene, that he wanted to change his estate plan so that Charles would receive one-third of the antique car collection and that the remainder of the estate would go to his daughters. Greene was also Charles's attorney and friend. He stalled in the preparation of the documents because of his concern about the changes Edward wanted to make to his estate plan. Ultimately a new will and trust amendment was executed on May 22, 1990, with the changes Edward had specified. Greene was named trustee as he had been in prior trusts.
Edward hired new counsel when he learned that among the documents he signed was a document giving Greene power of attorney. On May 31, 1990,
Hudner testified that Edward appeared to be thinking normally, was alert, understood the questions put to him, and responded in an articulate manner. Makinney also described Edward as articulate and completely in control of his faculties.
Hudner sought to verify Edward's intent with respect to the disproportionate gift to Charles. Hudner prepared a detailed memorandum in respect to the meeting with Edward, including, verbatim, portions of his conversation. Edward told Hudner that his relationship with Charles was "bad" and had been so for four or five years, and that Charles did not speak to his sisters or to him. He also criticized Charles's managerial skills, stating he was doing a terrible job of managing the company, was absent at critical periods, and did not have good people around him. When Hudner pointed out that the new will and trust amendment gave Charles only a one-third share of the antique car collection, Edward responded that he had already done enough for his son. He noted that he had already given Charles a 40 percent share of the company, a $1 million salary plus bonuses, and real estate valued in the many millions of dollars. Charles's share of the profits was twice as large as that of each of his sister's. Edward also mentioned that his eight grandchildren, including the three children of Charles and Barbara, had already received a one-half interest in property worth $20 million.
When Hudner suggested a $1 million gift to Charles, Edward responded that it would mean nothing to his son. Edward again cited all he had done for Charles apart from the trust. He criticized his son's excessively affluent life-style and stated he was spoiled. Hudner concluded Edward was not ambivalent about what Charles should receive from his estate.
Evidence at trial showed that Charles's net worth was between $12 million and $21 million.
Charles contends that (1) the trial court failed to apply the correct statutory standard for lack of testamentary capacity as set forth in section 6100.5,
The relevant portion of section 6100.5, subdivision (a), provides: "An individual is not mentally competent to make a will if at the time of making the will either of the following is true: [¶] ... [¶] (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." In support of his contention that the trial court appplied an incorrect statutory standard, Charles submits that in reaching its decision the court "applied a restrictive definition of delusion, based on a series of legal decisions which substantially pre-date the enactment of [section 6100.5, subdivision (a)(2)]," and in its statement of decision "employed the term `insane delusion': a term which is found nowhere in the statute and which does not even exist in the lexicon of modern psychiatry." Charles maintains that the trial court's use of the term "insane delusion" in the statement of decision and its reliance upon prestatutory case law was erroneous. We disagree and conclude that Charles has misconstrued the trial court's analysis.
With these principles in mind, we look to the legislative history of section 6100.5. On February 14, 1985, Senator Nicholas Petris, acting upon the proposal of an attorney, introduced Senate Bill No. 421. The original version of the bill provided that "there is a rebuttable presumption affecting the burden of producing evidence that a person who suffers from chronic mental unsoundness characterized by delusions or hallucinations, including, but not limited to, delusions of persecution or grandeur, where this unsoundness affects his or her choice of beneficiaries is of unsound mind." (Sen. Bill No. 421, (1985-1986 Reg. Sess.) § 1.) On July 2, 1985, while in the Assembly, the bill was amended so that the original proposal was deleted in its entirety and new provisions were substituted. The amended version of the bill included provisions nearly identical to those ultimately enacted as section 6100.5.
The trial court's finding that Edward was not delusional is supported by an abundance of competent evidence. First, evidence supported Edward's belief that Charles mistreated his sisters. There was evidence that Charles treated Joan poorly, especially during the 1986 Hawaii family vacation intended to be a reconciliation trip and that the mistreatment upset Edward. Second, the evidence established Edward was not delusional in his criticism of Charles's management of the business. Edward criticized Charles for not surrounding himself with good people, for spending time on personal affairs when he should have concentrated on business, for using a GLC employee, on company payroll, to maintain his boat, and for his inability to delegate authority. There is also evidence in the record that Edward was dissatisfied with the fact that Charles did not provide notice to all partners of partnership meetings and that Charles's bonuses were not subject to the approval of all partners. Evidence in the record supported Edward's beliefs.
Moreover, applying the statute and case law, the trial court properly concluded Charles failed to prove that the alleged delusion caused Edward to devise his property in a way which he would not otherwise have done. Substantial evidence supports the trial court's finding that Charles did not prove this causation element. The record reveals that Edward specified to Hudner and Montgomery several reasons for leaving Charles fewer assets than his sisters. Edward reasoned that he had a strained relationship with his son; that Charles already had a 40 percent share of the company and took 40 percent of the profits, a share twice as large as that of each sister; that Charles received a $1 million salary, plus bonus; and that Charles and his children had been given substantial interests in real estate. Edward believed he had already treated Charles very well. He thought his son led an affluent life-style and let money go to his head. Thus, apart from his beliefs about Charles's mistreatment of his sisters or his management skills, Edward had reasons why he wanted his son to receive a disproportionate share of the estate.
That Edward was not suffering from any delusions when he executed the will is buttressed by the fact that the May 22, 1990, will, prior to the hiring
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The judgment is affirmed both as to the appeal and the cross-appeal. Joan and Gloria are awarded their costs on appeal.
White, P.J., and Chin, J., concurred.
A petition for a rehearing was denied July 15, 1994, and the petition of appellant Charles Goodman for review by the Supreme Court was denied September 7, 1994. George, J., did not participate therein.
In the unpublished portion of this opinion we find that the trial court did not err in denying Joan and Gloria relief on their cross-complaint.