Tubbs v. Berkowitz - Case Brief

Tubbs v. Berkowitz - Case Brief

Tubbs v. Berkowitz

Case Number: G056951

Court: Cal. Ct. App.

Date Filed: 2020-04-07

Case Brief – Tubbs v. Berkowitz

Court: COURT OF APPEAL OF THE STATE OF CALIFORNIA
Date: 2025-09-05
Case Number: G056951
Disposition: The judgment is affirmed. Berkowitz shall recover his costs incurred on appeal.

Holding

The court held that a general power of appointment granted to the surviving spouse operates in a non‑fiduciary capacity, allowing the powerholder to appoint trust assets to himself even when he also serves as trustee; consequently, the trustee‑beneficiary cannot be deemed to have breached fiduciary duties by complying with a valid, expressly authorized exercise of that power.

The appeal in Tubbs v. Berkowitz turned on whether Harry William Berkowitz, as successor trustee of the irrevocable Marital Trust, could lawfully exercise the trust’s general power of appointment to transfer all trust assets to himself, thereby divesting the contingent beneficiaries—Janice Tubbs and her descendants. The Fourth Appellate District affirmed the trial court’s summary‑judgment ruling for Berkowitz, concluding that the power of appointment was absolute and that fiduciary duties did not constrain its exercise.

Procedural backdrop. After the death of Berkowitz’s wife in 2011, the Trust required the surviving spouse to allocate assets between a revocable surviving‑spouse trust and an irrevocable Marital Trust. In 2017 Berkowitz, acting as trustee, filed a petition to confirm his proposed allocation. Janice Tubbs objected, asserting that the general power of appointment could not be used to “subvert” the settlor’s intent to preserve assets for the children and grandchildren. Berkowitz moved for summary judgment, arguing that the power was a non‑fiduciary right permitting him to appoint assets to himself “for any reason or no reason.” The trial court granted the motion, holding the language “gives the surviving spouse…unfettered discretion” and that the trustee’s role did not limit the powerholder’s authority. Tubbs appealed.

Factual matrix. The 2005 Berkowitz Family Trust stipulated that, upon the death of the first spouse, the surviving spouse could direct the trustee to distribute “all or any part” of the trust to “one or more persons…including the surviving spouse…outright,” upon a written request referencing the power of appointment. The Marital Trust, irrevocable and non‑amendable, contained an identical clause. Berkowitz exercised the power, appointing himself as the sole recipient of all trust assets, thereby extinguishing the contingent interests of Tub’s children and grandchildren.

Legal issues. The appeal presented two intertwined questions: (1) whether a general power of appointment, even when held by a trustee, is exercisable in a non‑fiduciary capacity; and (2) whether the trustee‑beneficiary’s fiduciary duties under Probate Code §§ 16002, 16004, 16081 could limit that exercise.

Court’s analysis. The appellate court applied the summary‑judgment standard under Code Civ. Proc. § 437c, finding no genuine dispute of material fact. It reiterated the definition of a general power of appointment as a “non‑fiduciary” authority that may be exercised for the benefit of the holder, citing Estate of O’Connor (2018) 26 Cal.App.5th 871 and Estate of Daily (1982) 130 Cal.App.3d 993. The court emphasized that the Trust expressly granted the surviving spouse “unfettered discretion” to appoint assets, including to himself, and that the trustee’s duty was merely to follow the holder’s direction. The provision stating the trustee must act “in his fiduciary capacity” was interpreted as limiting only the trustee’s discretionary powers, not the separate role of the powerholder. Accordingly, the court found no basis for an implied covenant of good faith and fair dealing to curtail the power, and it rejected the argument that the dual role created a merger that would invalidate the Trust.

Conclusion and impact. By affirming that a general power of appointment can be exercised by a trustee‑beneficiary without breaching fiduciary duties, the decision reinforces the primacy of clear trust language over equitable considerations of intent. Practitioners drafting marital or family trusts must scrutinize appointment provisions, especially when the same individual may serve as both trustee and powerholder. The ruling leaves open the question of whether a trustee should be required to resign before exercising a self‑beneficial appointment—a point the court noted but did not decide. Future disputes may probe the limits of “non‑fiduciary” powers when combined with fiduciary roles, potentially prompting legislative clarification or tighter drafting safeguards.

Referenced Statutes and Doctrines

  • Probate Code §§ 16002, 16004, 16081 – fiduciary duties of trustees.
  • Probate Code § 15803 – rights of a holder of a presently exercisable general power of appointment.
  • Probate Code § 610(f) – definition of a general power of appointment as a non‑fiduciary authority.
  • Code Civ. Proc. § 437c – summary‑judgment standard.

Major Cases Cited

  • Estate of O’Connor (2018) 26 Cal.App.5th 871.
  • Estate of Daily (1982) 130 Cal.App.3d 993.
  • Estate of Kuttler (1958) 160 Cal.App.2d 332.
  • Hearst v. Ganzi (2006) 145 Cal.App.4th 1195.
  • Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826.
  • ABCO, LLC v. Eversley (2013) 213 Cal.App.4th 1092.
  • Jones v. Dept. of Corrections & Rehabilitation (2007) 152 Cal.App.4th 1367.

Last updated September 05, 2025.