Mautner v. Peralta

• Decision Date: 29 September 1989
• Docket Number: No. A043767,A043767
• Court: California Court of Appeals Court of Appeals
• Parties: Jerome J. MAUTNER, as Administrator, etc., Plaintiff and Appellant, v. Joe H. PERALTA et al., Defendants and Respondents.

Page 535

263 Cal.Rptr. 535

215 Cal.App.3d 796

Jerome J. MAUTNER, as Administrator, etc., Plaintiff and Appellant, v. Joe H. PERALTA et al., Defendants and Respondents.

No. A043767.

Court of Appeal, First District, Division 4, California.

Sept. 29, 1989.

Robert Westmeyer, County Counsel, Napa, for plaintiff and appellant.

Parnie & Barelli, Monterey, Joseph Hoffman, Joann M. Cook, Weinberg, Campbell & Stone, Sausalito, for defendants and respondents.

ANDERSON, Presiding Justice.

Does former Probate Code section 631 ¹ afford absolute immunity to a bank which transfers funds in a decedent veteran's deposit account to an alleged beneficiary proceeding under a section 630 affidavit despite actual notice of the superior, statutory claim of the California Veterans Home (Home)? We conclude it does not and reverse the judgment.

I. FACTUAL BACKGROUND

This appeal follows a judgment of dismissal upon the sustaining of a demurrer without leave to amend. In testing the sufficiency of the complaint against the demurrer, we treat the demurrer as " 'admit[ting] the truth of all material factual allegations in the complaint....' " (Kendall v. Ernest Pestana, Inc. (1985) 40 Cal.3d 488, 493, 220 Cal.Rptr. 818, 709 P.2d 837, quoting Alcorn v. Anbro Engineering, Inc. (1970) 2 Cal.3d 493, 496, 86 Cal.Rptr. 88, 468 P.2d 216.) Further, adhering to a policy of liberal construction, the complaint will withstand demurrer if, upon consideration of all the allegations so construed, it appears plaintiff is entitled to any relief against defendant. (Glaire v. La Lanne-Paris Health Spa, Inc. (1974) 12 Cal.3d 915, 918, 117 Cal.Rptr. 541, 528 P.2d 357; Air Quality Products, Inc. v. State of California (1979) 96 Cal.App.3d 340, 347, 157 Cal.Rptr. 791.)

We derive the following summary from the allegations in the second amended complaint. Gugliemno Canevoni took up residency at the Home in Yountville on September 22, 1981, where he resided until his death on May 28, 1984. Canevoni died testate, leaving his entire estate to his friends, Joe H. and Jennie Peralta, and naming Joe as executor of the will.

At the time of his death Canevoni had a total of $13,028.25 on deposit at the Salinas Main Branch of Wells Fargo Bank, N.A. ² On June 19, 1984, the Home sent a letter, certified mail, to the operations officer at the Salinas branch (1) notifying the bank that Canevoni had died leaving no surviving spouse, children, grandchildren or parents; (2) explaining that pursuant to sections 1035.05 and 1035.1 of the Military and Veterans Code (hereafter sections 1035.05 and 1035.1), the Home believed it was entitled to those deposits; and (3) requesting the bank to place a hold on the identified accounts. Wells Fargo received the letter on June 26 and flagged the accounts.

Also, on June 19, the Home notified the Peraltas by letter that, pursuant to sections 1035.05 and 1035.1, the Home believed it was entitled to recover all personal property of the decedent other than certain personal effects of no substantial value located at the Home. The Home appended a copy of the statutory provisions to the letter and enclosed a declaration relating to disposition of the decedent's personal effects. Joe Peralta signed the declaration on July 6 and returned it to the Home prior to July 10.

Then, on July 10, Joe Peralta filed with Wells Fargo a declaration under penalty of perjury pursuant to section 630, indicating that he was the sole beneficiary named in decedent's will and entitled to receive all funds of decedent on deposit at the bank. Wells Fargo released the funds to Peralta.

On August 30, 1984, and on several occasions thereafter, Jerome J. Mautner, Public Administrator for Napa County (appellant), asked Wells Fargo to reimburse decedent's estate in an amount equal to the funds disbursed to Joe Peralta. Initially, the bank asked for a chance to review the possibility of returning the funds, requesting that litigation not ensue but, since March 13, 1985, the bank has refused to pay anything.

On December 19, 1984, the Napa County Superior Court appointed appellant as administrator with will annexed of decedent's estate, and issued letters of administration that day.

Appellant filed this lawsuit against the Peraltas and Wells Fargo on June 21, 1985 alleging causes of action for negligence, conversion, and constructive trust. Wells Fargo successfully moved for judgment on the pleadings, arguing that the complaint failed to state a cause of action against the bank because (1) section 631 operated to discharge the bank from any liability for paying the funds on deposit in decedent's accounts to Joe Peralta and (2) the bank had no duty to the Home because the Home failed to adhere to the requirements of sections 1035.05 and 1035.1. The trial court granted the motion but allowed appellant 30 days to amend to challenge the constitutionality of former sections 630 and 631. Appellant filed an amended complaint, alleging two additional causes for "complaint for money" and declaratory relief. The court sustained Wells Fargo demurrer without leave to amend.

II. STATEMENT OF GROUNDS

Before turning to the merits, we resolve a preliminary issue relating to the trial court's duty to state the legal basis for its ruling on the demurrer. Appellant contends the order sustaining the demurrer was improper because it did not state the grounds for the decision. Whenever a court sustains a demurrer, Code of Civil Procedure section 472d requires the court to state the specific ground or grounds for the ruling. A court satisfies this requirement by referencing the appropriate paragraphs of the demurrer or supporting points and authorities. (Code Civ.Proc., § 472d; E.F. Hutton & Co. v. City National Bank (1983) 149 Cal.App.3d 60, 65, fn. 1, 196 Cal.Rptr. 614.) An order made " '... per points and authorities in moving papers ...' " does not suffice. (Id., at pp. 64-65, 196 Cal.Rptr. 614.)

Wells Fargo demurred on the basis that the complaint did not state facts sufficient to constitute any cause of action against the bank or its defendant employees. In its ruling the court specifically stated: "[I]t appearing from the points and authorities filed herein that the second amended complaint does not state facts sufficient to constitute a cause of action against [defendants], IT IS HEREBY ORDERED that the demurrer ... is sustained without leave to amend."

The court's specification here satisfies the Code of Civil Procedure section 472d requirement of identifying the grounds for sustaining the demurrer. Wells Fargo's sole ground has always been that the complaint does not state facts sufficient to state a cause of action. Code of Civil Procedure section 472d does not mandate a detailed statement explaining the court's reasons for sustaining the demurrer on the ground specified. (Berkeley Police Assn. v. City of Berkeley (1977) 76 Cal.App.3d 931, 943, 143 Cal.Rptr. 255.)

III. STATUTORY SCHEMES

A. Military and Veterans Code Provisions

In the absence of certain favored heirs, the Military and Veterans Code establishes the Home as the statutory heir to all moneys and other personal property of a veteran who became a member of the Home prior to January 1, 1984. Section 1035.05, subdivision (b), provides in pertinent part: "All moneys and other personal property of any veteran other than that described in Section 1035 [relating to property held by the Home or left on the premises] shall, upon the death of the veteran, in the absence of a spouse, children, grandchildren, or father or mother, pass and descend to and become the property of the home for credit to the post fund...." ³

Again, as to veterans who became members of the Home prior to January 1, 1984, section 1035.1, subdivision (b), prevents testamentary disposition by such a veteran to any except certain favored near relatives, if he was a member of the Home at the time of death: "Any will ... executed by a veteran, whether executed before or after admission to the home, shall not be valid as to any provision therein contained which purports to dispose, either directly or indirectly, of moneys or personal property to other than the spouse, children, grandchildren, or father or mother of the veteran. This section does not apply to any veteran who is not a member of the home at the time of death."

This statutory scheme has withstood state and federal equal protection challenges. In Estate of Murphy (1974) 37 Cal.App.3d 411, 112 Cal.Rptr. 317, the Court of Appeal held there was a reasonable legislative basis for distinguishing between veterans who died in the home (where they were cared for by the state) and those who left the home, to be cared for by others, perhaps even distant relatives or nonrelatives. (At p. 417, 112 Cal.Rptr. 317.)

Under the facts as set forth in the complaint, sections 1035.05 and 1035.1 operate to void Canevoni's will, which purported to leave all his moneys and personal property to nonrelatives, and to substitute the Home as his statutory heir.

B. Probate Code Provisions

Former section 630 et seq. set forth procedures for the nonprobate distribution of a decedent's personal property when the gross value of decedent's property in California did not exceed $60,000 (with a $10,000 cap for real property). If these limitations applied, the sole beneficiary, or all of the beneficiaries, under the will could collect money due the decedent, without procuring letters of administration or awaiting probate of the will, by providing the entity owing the money with an affidavit or declaration under penalty of perjury showing the right of the affiant or affiants to receive the money. (§ 630, subd. (b).)

Former section 631 discharged a bank or other entity from any further obligation to pay money when it transferred the decedent's funds in reliance on such an affidavit: "The receipt of such affiant or affiants shall constitute sufficient acquittance for any payment of money or delivery of property made...