McKenzie

The issue in this appeal is whether a trust beneficiary may avoid a no contest clause in a trust instrument by utilizing a statutory procedure under California probate law to reallocate trust principal and income. We conclude that the statutory procedure does not insulate the beneficiary from the impact of the no contest clause, which is broad enough to encompass the relief she ultimately seeks. We affirm the order of the trial court denying plaintiff’s application for an order determining that her proposed action would not violate the clause.

FACTUAL AND PROCEDURAL SUMMARY

In 1959, Maud L. Bull created an irrevocable inter vivos trust with 2,000 shares of International Business Machines Corporation stock. There are three tiers of beneficiaries, each with a distinct interest. The first tier beneficiaries (seven individuals) are to receive fixed monthly payments ranging from $200 to $500 for life. The rest of the net trust income is to be accumulated by the trustee and added to the principal.

Upon the death, of the last of the first tier beneficiaries, the remaining trust estate is to be divided into three equal shares (each share to be held, administered, and…