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SUPERIOR COURT OF CALIFORNIA
COUNTY OF SAN FRANCISCO
Document Scanning Lead Sheet
Oct-10-2012 10:53 am
Case Number: PTR-12-296124
Filing Date: Oct-10-2012 10:49
Filed by: NOELIA RIVERA
Juke Box: 001 Image: 03796171
PROBATE EX PARTE APPLICATION FOR ORDER (HEARING)
IN THE MATTER OF THE SAN LEE et al TRUST
001P03796171
Instructions:
Please place this sheet on top of the document to be scanned.Solan, Park &
Robello LLP
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Sheila K. Robello, Esq. (SBN 209300) San Francisco County Superior Court
Deborah L. Fox, Esq. (SBN 233415) we prunes
SOLAN, PARK & ROBELLO, LLP OCT FU Zulg
354 Pine Street, Fifth Floor
San Francisco, California 94104 RK OF i = COURT
Telephone: 415/777-3300 By:
Facsimile: 415/777-3301 Deputy Clerk
Attorneys for Petitioner and ooo 16 2012
Proposed Successor Trustee Leo F. Bautista
SUPERIOR COURT OF CALIFORNIA
COUNTY OF SAN FRANCISCO
IN RE CASENO. PTRo -12-2961e2
qleignature by Facsimile]
PETITION FOR ORDER APPOINTING
LEO F. BAUTISTA AS SUCCESSOR
TRUSTEE AND BRINGING TRUST
UNDER CONTINUING COURT
San Lee and Mui Chow Lee SUPERVISION; WAIVING
Revocable Trust u/d/t dated March ACCOUNTINGS AND TRUSTEE’S
24 1985, as amended December BOND AND ORDER DIRECTING
22, 2004 FORMER TRUSTEE STO TRANSFER
ALL TRUST PROPE TO
SUCCESSOR TRUSTEE
[PC §17200, 15660]
4
ATE:
TIME: 9:00 a.m.
DEPT: Probate, Room 204
Leo Bautista submits this Petition for Order Appointing Leo F. Bautista as
Successor Trustee and Bringing Trust Under Continuing Court Supervision;
Waiving Accountings and Trustee's Bond and Order Directing Former Trustee(s)
to Transfer All Trust Property to Successor Trustee. Petitioner alleges as follow:
1. History of Proceedings. San Lee and Mui Chow Lee, husband and
wife, and herein after referred to as “settlors” created that San Lee and Mui Chow
Lee Revocable trust on March 24, 1985. Thereafter the trust was amended on
November 15, 1996, January 23, 1998, July 21, 1999 and July 13, 2002. On
PETITION FOR ORDER APPOINTING LEO F. BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGING TRUST
UNDER CONTINUING COURT SUPERVISION; WAIVING ACCOUNTINGS AND TRUSTEE’S BOND; ETC.Solan, Park &
Robello LLP
December 22, 2004 Mui Chow Lee, the surviving settlor, executed a fifth
amendment to the trust. This amendment revoked all prior amendments
(amendments 1 through 4).
2. The trust currently consists of the San Lee and Mui Chow Lee
Revocable Trust u/d/t dated March 24, 1985 (the Trust) and the Fifth Amendment
to Declaration of Trust dated December 22, 2004 (Fifth Amendment). A copy of
the trust and the Fifth Amendment are attached hereto as Exhibits A and B
respectively.
3. San Lee died on October 4, 1998.
4. Mui Chow Lee died on November 25, 2009.
5. Crystal H. Chow was named as the successor trustee under Article
7.2 of the trust, as amended in the Fifth Amendment to the Declaration of trust as
follows:
2. Paragraph 7.2 of Article Seven commencing on page 18
of said Trust shall be revoked in its entirely and be replaced by the
following:
7.4 (Sic) Successor Trustees. If the office of trustee
becomes vacant by reason of death, incapacity, or an’ other
reason, and no successor trustee or cotrustees have been
designated under any other provision of this trust instrument, the
following, in the order of priorty indicated, shall be trustee:
First, Crystal H. Chow, settlor Mui Chow Lee's niece;
Second, Jeanette Lau St. Onge, settlor Mui Chow Lee’s
niece.
If all those named above are unwilling or unable to serve as
successor trustee, a new trustee or cotrustees shall be appointed
by majority vote of the adult beneficiaries fo the trust who are then
entitle to receive income under the trust, or who would be entitled
to receive a distribution of principal from the trust if the trust were
then terminating, and who then have the legal capacity to give
such a vote, if a majority of the beneficiaries are unable to agree
on a new trustee or cotrustees, a new trustee or cotrustees may
be appointed by the court.
5. Crystal Chow served as successor trustee from January 2010 to
February of 2012, represented by Katherine Yee, Esq. In January of 2012 she
prepared and served upon the named successor trustee Jeanette Lau St. Onge, a
written resignation which made her resignation effective on February 29, 2012.
PETITION FOR ORDER APPOINTING LEO F. BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGING TRUST
UNDER CONTINUING COURT SUPERVISION; WAIVING ACCOUNTINGS AND TRUSTEE’S BOND; ETC. - 2 -Solan, Park &
Robello LLP
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to serve or to take on the role of successor trustee.
at Article 6, Paragraph 6.1 (f) that:
(f) On the death of the survivin: settlor, the entire remaining
principal of the Power of Appointment Trust, all net income then held
y the trustee, and all income then accrued but not collected by the
trustee, after any payment of taxes, debts , and expenses ursuant
to the applicable provisions of this instrument, m (sic) shall be
distributed as follows:
(1) Upon the death of the Settlor, if either the settlor’s brother
Choung Yee Chow (choung Yee”) or the settlor's nephew, Brian
Leland Chow (“Brian”) shall then be living, then the trustee shall
retain any interest in that certain real property commonly known as
134 Athens Street, San Francisco, California which is then a part of
the trust estate (herein after “the premises”) in a se arate trust to be
administered as set forth below in this subparagrap! (y(t) of
Paragraph 6.1 f Article Six. Such trust, if created shal
referred to as the “House Trust.” If no interest in said real property
shall be a part of the trust estate at the time of the settlor's death ,
then the House Trust Shall not be created, and the premises shall
augment the balance of the trust estate and shall be distributed as
set forth below in subparagraphs (B) through (D) of this Paragraph
6.1 of Article Six.
(1.1) If the House Trust is created, then during the term of the
House Trust, the settlor’s brother Choung Yee and the settlor's
nephew, Brian shall have the right to occupy the premises free fo
rent. Any unoccupied portions fo the premises May be rented out.
During the term of the House Trust, the trustee shall pay for an
property taxes, assessments, insurance, maintenance, and ordinary
repairs on the premises from the above rental income, if any.
occupying parties shall pay any balance of the property taxes,
assessments, insurance maintenance, and ordinary repairs on the
premises not paid with the above said rental income, t
parties are unable to pay for the property taxes, assessments
insurance maintenance and ordinary repairs on the premises, then
the trustee shall pay for the above from the funds in the Expense
rust below.
(1.2) Notwithstanding any other provision contained in this
the House Trust.
Mt .3) The House Trust shall terminate upon i) the death of the
second of Choung Yee and Brian’s death, or il) upon written notice
PETITION FOR ORDER APPOINTING LEO F. BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGIN'
UNDER CONTINUING COURT SUPERVISION; WAIVING ACCOUNTINGS AND TRUSTEE’S BOND>
Ms. Chow also made repeated request to Jeannette Lau St. Onge to either decline
6. To date Jeannette Lau St. Onge has failed to assume the role of
successor trustee, to the clear detriment of the trust estate and its beneficiaries.
7. Dispositive Provisions of the Trust. The Fifth Amendment provides
hereinafter be
the occupying
Declaration, the trustee shall not sell the premises during the term of
IG TRUST
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form both Choung Yee and Brian that they no longer wishes to
occupy said premises, whichever is later. Upon such termination,
the trustee shail sell the above said premises. The trustee shall pay
for the expenses of the last illness and funeral of both Choung Yee
Chow and Brian Leland Chow, whenever the last illness and funeral
occurs, out of the principal of the trust; unless the trustee determines
that other adequate provisions have been made for payment of these
expenses.
8. The settlor’s brother, Choung Yee died on July 31, 2011.
9. Brian Leland Yee (Brian) survived the settlors and resides in the trust
property at 134 Athens Street, San Francisco, CA (Athens Street).
10. Financial Position of Trust. The trust currently contains only the
Athens Street property in which Brian resides. Pursuant to the terms of the trust at
Article 6, Subparagraph 6.1 (f) section 1.1
... During the term of the House Trust, the trustee shall pay for any
property taxes, assessments, insurance, maintenance, and ordinary
repairs on the premises from the above rental income, ifany. The
occupying parties shall pay any balance of the property taxes,
assessments, insurance maintenance, and ordinary repairs on the
premises not paid with the above said rental income, if the occupying
parties are unable to pay for the property taxes, assessments
insurance maintenance and ordinary repairs on the premises, then
the trustee shall pay for the above from the funds in the Expense
Trust below.
Choung Lee made payment of approximately $1,060 from April 2010 to July
2011. Brian Lee made payment of $640 with the last payment of $140 being made
in December 2011. However, these payments were insufficient to make payment in
full on the property taxes and there is currently a delinquent tax bill in excess of
$10,900. See Schedule of payment attached hereto as Exhibit Cc.
There are no assets to maintain the property or pay for taxes or insurance.
In fact, former trustee Crystal Chow has expended approximately $4,500 of her
personal funds for attorney fees and payment of expenses of the trust including
property insurance and utility bills, see Exhibit D attached hereto and incorporation
herein for all purposes showing payment made by former trustee, Crystal Chow.
11. Vacancy in Office of Trustee and Need for Immediate
Administration of Trust. Crystal Chow resigned as trustee on January 29", 2012
PETITION FOR ORDER APPOINTING LEO F. BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGING TRUST
UNDER CONTINUING COURT SUPERVISION; WAIVING ACCOUNTINGS AND TRUSTEE’S BOND; ETC. ~~Solan, Park &
Robello LLP
with 30 day notice. Her resignation was thus effective at the end of February 2012.
Despite over eight months having passed, Jeanette Lau St. Onge, the named
successor trustee has failed to act. Accordingly, there is a vacancy in the office of
trustee. It is necessary that a successor trustee be appointed immediately to
address the status of the trust, ensure that the trust property is secured, insured
land properly managed and to develop a pian to pay the expenses of the property
and of the trust administration.
Specifically, the following issues must immediately be addressed to property
the trust property from liability.
i) Unauthorized Rental of Trust Property. Petitioner is informed and
believes that Brian resides in the real property and rents out space in the home to
tenants. Despite repeated requests from the former trustee, Crystal Lee, the rental
incomes are not turned over to the trustee or used to pay the expenses of the
property. The former trustee has also been contacted by an individual who claims
to be a legal tenant with complaints that Brian has stolen his rent money and
demanding a formal lease agreement. This situation illustrates another liability for
ithe estate which has the potential to negatively impact both the current beneficiary
Brian and the residuary beneficiaries
ii) Outstanding Property Tax liability. Petitioner is informed and
believes that there is currently an outstanding property tax bill in excess of $10,900
due October 31, 2012. As the successor in interest to the property are not
children, grandchildren or parents of the settlors the property tax has been
reassessed and supplemental taxes have been assessed and are now due.
iii) Violation of Local Ordinances. San Francisco has also sent four
warnings letters in the last six months to the former trustee as Brian, and/or his
roommates, leave garbage cans and garbage outside of the house in violation of
city ordinance. Petitioner is also informed and believes that the property is well
known to local law enforcement agencies
PETITION FOR ORDER APPOINTING LEO F. BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGING TRUST
UNDER CONTINUING COURT SUPERVISION; WAIVING ACCOUNTINGS AND TRUSTEE’S BOND; ETC, - 5 -Solan, Park &
Robello LLP
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iv) Lack of cooperation from beneficiary Brian. Petitioner is informed
land believes that the former trustee, Crystal Chow, was unable to work with Brian
las the trust beneficiary to resolve the financial issues of the trust and that in fact
she feared for her safety if she confronted Brian. Petitioner is informed and
believes that a neutral professional trustee is necessary to immediately address the
issues that must be faced in the administration of this trust.
12. Trust Provisions Relating to Interests of Remainder Beneficiaries.
While Brian is the current beneficiary of the House Trust (as discussed
pelow) the trust also has four named remainder beneficiaries: Crystal Chow,
Jeanette Lau St. Onge, Fiona Chow and Justin Chow. Therefore, the trustee of
the this trust must consider the impact of the remainder beneficiaries of decisions
made during the trust administration.
Pursuant to Article 6, Paragraph 6.1(f)(1) (1.4) of the trust if the Athens
Street property is part of the trust estate a “house trust’ is to be established and
during the lives of Choung Lee and/or his son Brian Lee they are entitled to live in
the house rent free. The trust provides two means by which the House trust may
terminate making the remainder beneficiaries entitled to the proceeds. The first is
on the death of Brian.
If Brian dies than the property shall be sold and the net proceeds of the sale
lof the house shall be distributed: $50,000 to the settlor’s grandniece, Fiona Chow,
$50,000 to the settlor’s grandnephew, Justin Chow and the balance of the
proceeds to the settlor’s nieces Crystal H. Chow and Jeanette Lau St. Onge.
The second way to terminate the trust is if Brian no longer wishes to reside
in the property. In that case the property is to be sold and the net proceeds of the
property shall distributed, pursuant to Article 6, Paragraph 6.1(f)(1) (1.5) as follows:
$50,000 to the settlor’s grandniece, Fiona Chow, $50,000 to the settlor's
grandnephew, Justin Chow , $70,000 in trust for Brian, and the balance of the
proceeds outright and free of trust to Settlor Mui Chow Lee’s brother Choung Yee
PETITION FOR ORDER APPOINTING LEO F. BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGING TRUST
UNDER CONTINUING COURT SUPERVISION; WAIVING ACCOUNTINGS AND TRUSTEE'S BOND; ETC. -0-Solan, Park &
Robello LLP
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Chow, settlors nieces, Crystal H. Chow and Jeannette Lau St. Onge. If any of the
above named three individuals shall be deceases at the time of the surviving
settlor’s death, then his or her share of said net proceeds from the sale of said trust
property of the House Trust shall be distributed to the survivor of them.’
As outlined in Paragraph 11 above there are issues such as payment of
property insurance and taxes that must be immediately address and that have an
impact on not only Brian but potentially on the residuary beneficiaries should the
property be the subject of a tax sale or should the become damaged while there is
no insurance in place.
13. Request that trust be brought under continued court supervision.
Given the past difficulties with the administration of this trust and the bevy of
serious outstanding issues, such as payment of delinquent property taxes and of
laddressing the rental of the property, Petitioner submits that the trust should be
brought under the continued supervision of the court.
14. Waiver of Trustee Bond and Trust Account. As the trust currently
contains only the real property located 134 Athens Street and no liquid assets,
Petitioner believes that is is appropriate to waive bond and an accounting at this
time. Should additional assets be located or should the trust property begin to
generate income, Petitioner will submit an ex parte application for a bond and a
date for an accounting to be set in this matter.
15. Nomination of Leo Bautista. A majority of the adult beneficiaries of
the trust have nominated Leo Bautista to serve as successor trustee. The
nominations of Fiona Chow, Justin Chow and Crystal Chow are filed under
__
‘This section of the trust provides two different dispositive provisions, within the same
paragraph, should Chystal Chow, Choung Lee or Jeanette Lau St. Onge predecease the
surviving settlor. The first is that their share shall go equally to the survivor of them and the
second is that their share shall go outright to their issue. Petitioner believes that the correct
provision is that the share is distributed to the survivor of them. Otherwise this section would
be in direct conflict with the special needs trust provision fou nd in the trust for Choung Lee son,
Brian.
PETITION FOR ORDER APPOINTING LEO F. BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGING TRUST
UNDER CONTINUING COURT SUPERVISION; WAIVING ACCOUNTINGS AND TRUSTEE’S BOND; ETC. - 7-Solan, Park &
Robello LLP
separate cover. Petitioner is informed and believes that Jeannette Lau St. Onge
and Brian Chow will not be filing nominations.
16. Trust Beneficiaries. The names, ages and addresses of the
beneficiaries of the trust as known to petitioner are:
Brian Leland Chow adult 134 Athens Street
San Francisco, CA 94112
Fiona Chow adult 9961 Waxberry Court
Las Vegas, NV 89178
Justin Chow adult 9961 Wax berry Court
Las Vegas, NV 89178
Crystal Chow adult 125 Olmstead Street,
San Francisco, CA 94134
Jeannette Lau St Onge adult 1893 Sweetwood Drive
Daly City, CA 94015
17. Request for Special Notice. No request for special notice have been
filed. Notice of this hearing will be provided as required by law.
Wherefore Petitioner request an order that:
1. Notice of the hearing on this petition has been given as required by law
land no further or other notice is required;
2. Leo F. Bautista is appointed as sole successor trustee of the Trust;
3. The San Lee and Mui Chow Lee Revocable Trust u/d/t dated March 24
1985, as amended December 22, 2004 , is brought under the continuing
supervision of this Court;
4. The Trustee’s bond is waived;
5. Accountings are waived until such time as the trust estate generates
income or the real property is liquidated;
6. Court authority is required prior to the trustee taking any of the following
acts: amending or revoking of the Trust; making gifts from the Trust estate; making
sales of real property of the Trust, which sales shall also require Court
PETITION FOR ORDER APPOINTING LEO F. BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGING TRUST
UNDER CONTINUING COURT SUPERVISION; WAIVING ACCOUNTINGS AND TRUSTEE’S BOND; ETC. -O-18/18/2012 69:25 51g8434AA4 BAUTISTA BAUTIST“ PAGE 91/43
+ Iconfirmation, or encumbering real property of the Trust; and making payment of
2 compensation to the successor trustee and the successor trustee's attorney,
Sie
4 7. Former trustee, Crystal Chow, is directed to tum over all assets of the
§ lfrust, including records and tax documents, to successor trustee Leo F. Bautista;
6 8. For such other or additional orders as the court finds necessary.
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Respectfult
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Leo Fr, Bautista, Petitioner and Proposed
10 Successor Trustee
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Solan, Park & PETITION FOR ORDER APPOINTING LEO F. BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGING TRUST
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VERIFICATION
|, Leo F. Bautista, am the proposed successor trustee of the San Lee and Mui
how Lee Revocable Trust u/d/t dated March 24 1985, as amended December 22,
004. | have read the foregoing document entitled PETITION FOR ORDER
PPOINTING LEO F. BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGING
RUST UNDER CONTINUING COURT SUPERVISION; WAIVING
IACCOUNTINGS AND TRUSTEE’S BOND AND ORDER DIRECTING FORMER
TRUSTEE(S) TO TRANSFER ALL TRUST PROPERTY OVER TO SUCCESSOR
TRUSTEE and know its contents. The matters stated therein are true of my own
knowledge, save and accept those matters stated on information and belief, and, as to
knose matters, | believe them to be true.
1 declare under penalty of perjury under the laws of the State of Catifornia that the
regoing is true and correct.
PETITION FOR ORDER APPOINTING LEO F, BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGING
UNDER CONTINUING COURT SUPERVISION; WAIVING ACCOUNTINGS AND TRUSTEE'S BOND; ETC. - 10 ~SAN LEE AND MUI CHOW LEE REVOCABLE TRUST .
Table of Contents
ARTICLE ONE
CREATION OF TRUST
Declaration... ee ee ee
Names of Trusts... ee ee
Effective Date... ee ee eee
No Living or Deceased Children «6... eee et eee
Definition of Issue 2... ee ee Pete ee eee
ARTICLE TWO
TRUST ESTATE
Definition of Trust Estate 20. eee
Character of Trust Assets... ee eee
Nonprobate Transfers of Community Property... .. . Lee
Additions to Trust... 0 ee ee
ARTICLE THREE
RIGHTS AND POWERS OF SETTLORS
Power of Revocation While Both Settlors Are Living .......-..--.----
Power of Revocation and Amendment After Death of Deceased Settlor..... ...
Method of Revocation or Amendment .... 2.2... 6.2. e ee eee eee eee
Delivery of Property After Revocation ©... -... eee eee eee ee
Trustee’s Retention of Assets on Revocation... .. 6... 6+ ee eee ee cae
Settlors’ Power to Direct.Investments While Both Settlors Are Living .......
Power to Direct Investments After Death of Deceased Settlor ..........-.-
Settlors’ Power to Borrow From Trust Estate While Both Settlors Are Living . . .
Power to Borrow From Trust Estate After Death of Deceased Settlor........
Exercise of Rights and Powers of Settlors By Others... .-..------+e0s
ARTICLE FOUR
DISTRIBUTIONS DURING SETTLORS’ JOINT LIVES
Payment of Income During Settlors’ Joint Lives .. 0... 6. ee eee eee
Distributions of Principal During Settlors’ Joint Lives ....-...--.--+-+---
Distributions of Principal at Request of Settlors ........-.---- +++ --e-
Settlors’ Obligation for Community Property Distributed .....-....-+.--
- Requests in Behalf of a Settlor Unable to Do So Personally ...-...--
tabbies*
EXHIBIT
AARTICLE FIVE
DISTRIBUTIONS AFTER DECEASED SETTLOR’S DEATH
Payment of Death Taxes, Debts, and Expenses on Statement From Personal
Representative 2.0... ee eee ee tte 10
Trustee’s Power to Defer Division or Distribution ......-...----.+-+- 11
Trust Estate Allocated to Power of Appointment Trust........-.-.50-6- 11
Intention That Disposition Qualify for Marital Deduction ............-.- i
Disclaimer of Property... . 2... eee es 11
ARTICLE SIX .
DISPOSITIVE PROVISIONS OF TRUSTS CREATED
AFTER DECEASED SETTLOR’S DEATH
Power of Appointment Trust... 1... eee eee 12
Disposition of Disclaimer Trust Until Death of Surviving Settlor .......... 14
Disposition of Disclaimer Trust on Death of Surviving Settlor ............ 14
Trust for Fiona 6. ee 17
Spendthrift Clause ©... eee 17
ARTICLE SEVEN
TRUSTEE
Remaining Settlor-Trustee Serves Alone ... 2.1... 6 ee ee ee ees 18
Successor Trustees 22... ee ee ee 18
Definition of Trustee 2... eee 19
Removal and Replacement of Trustee ...- 2... eee eee 19
Waiver of Bond 2... 0. ee ee 19
Procedure for Resignation... 6... . ee eee 19
General Powers of Trustee 2.1... ee ee ee 20
Power to Retain Trust Property 2.2.6... eee ee tent 22
Trustee’s Power to Invest Property ©... .. 2.60 eee ee eee 22
Power Over Unproductive Property... 2.0... eee eee ee eee eee 22
Power to Operate Business . 2... ee 22
Power to Self-Deal ... 2.22. eee eet eee bees 23
Power to Combine Trust Assets 24
Division or Distribution in Cash or Kind ... 2... 2... ee ee ee eee eee 24
Payments to Legally Incapacitated Persons ... 6... 1... ee eee eee eee 24
Trustee’s Liability... ee 25
Written Notice to Trustee 2 2. ee ee 25
Duty to Account 2.2. ee eee 25
Cotrustee May Delegate Acts to Other Cotrustee .........----------- 25
ARTICLE EIGHT
CONCLUDING PROVISIONS
Perpetuities Savings Clause «6... eee 25
Simultaneous Death... ... ce eee eee eee ee eens 26
No-Contest Clause 2... et ee 26
"Deceased Settlor” and "Surviving Settlor” 2.2... eee 27Definitions of Death Taxes, Debts, and Expenses... 1.2... 0.0 e eevee 27
Definition of Education 2... 61. ce ee te eee 28
Captions 2... ee ee ete 28
Severability Clause 2... ee ee ee ee eee 28
California Law to Apply 2.0.6 ee ee ee 28
ARTICLE NINE
SIGNATURE AND EXECUTION
Execution 2.2 ee eee eee 29ee
oo
SAN LEE AND MUI CHOW LEE REVOCABLE TRUST
ARTICLE ONE
CREATION OF TRUST
1.1. Declaration. San Lee and Mui Chow Lee, husband and wife, of San Francisco
County, California, who are herein referred to as "the settlors" or "the trustees,” depending
on the context, hereby declare that they hold certain property (the “trust estate") in trust, to
be held, administered, and distributed according to the terms of this instrument.
1.2. Names of Trusts. The trusts created by this instrument shall be known
collectively as the San Lee and Mui Chow Lee Revocable Trust, and each separate trust
created under this instrument shall be referred to by adding the name or designation of that
separate trust as it appears in the appropriate section of this instrument.
1.3. Effective Date. This declaration shall be effective immediately on execution by
all the parties.
1.4. No Living or Deceased Children. The settlors have no living or deceased
children.
1.5. Definition of Issue. As used in this instrument, the term "issue" refers to all
persons referred to in California Probate Code Section 50, as in effect at the time of the
execution of this instrument.San Lee and Mui Chow Lee Revocable Trust
ARTICLE TWO
TRUST ESTATE ©
2.1. Definition of Trust Estate. All property subject to this instrument from time to
time is referred to as the "trust estate" and shall be held, administered, and distributed as
provided in this instrument. The trustee shall hold, administer, and distribute the property
described in the Schedule of Community Property Assets (which is attached hereto and made
a part of this trust instrument), any other property that may be hereafter subject to this trust,
and the income and proceeds attributable to all such property, in accordance with the
provisions of this instrument.
2.2. Character of Trust Assets. All community property of the settlors transferred to
€ : this trust, and the proceeds of all such property, shall continue to be community property
under the laws of California, subject to the provisions of this instrument. All separate and
quasi-community property shall remain the separate or quasi-community property,
respectively, of the contributing settlor.
2.3. Nonprobate Transfers of Community Property. The consent of the settlors to
the transfer of any community property assets subject to this trust shall be governed solely by
the terms of this trust instrument. California Probate Code Sections 5010 through 5032 (or
any successor sections), dealing with nonprobate transfers of community property, shall be
inapplicable to any trust created by this instrument.
2.4. Additions to Trust. From time to time, the trustee may accept additions to this
trust from any source. All such additions shall become part of the trust estate and shall be
2San Lee and Mui Chow Lee Revocable Trust
held, administered, and distributed in accordance with the terms of this instrument. That
additional property shall become part of the trust estate on written acceptance of it by the
trustee. Any additions to the trust shall be made by designating in writing the property to be
added. However, the titling of any account, deed, or similar asset in the name of the trustee,
as trustee of this trust, or any alternate or successor trustee acting under this instrument,
shall be deemed to be a transfer to this trust. Any designation by a third party, whether by
will, deed, account title designation, or similar transfer, shall also be a transfer to the trust
estate.
ARTICLE THREE
RIGHTS AND POWERS OF SETTLORS
3.1. Power of Revocation While Both Setilors Are Living. During the joint lifetimes
of the settlors, any trust created by this instrument may be amended, revoked, or terminated,
in whole or in part, by either settlor acting alone, as to any separate and quasi-community
property of that settlor and any community property of the settlors. However, any
modification of the rights and interest of either settlor in community property during the
marriage of the settlors may be made only with the joinder or consent of both settlors.
3.2. Power of Revocation and Amendment After Death of Deceased Settlor. After
the death of the deceased settlor, the surviving settlor may at any time amend, revoke, or
terminate, in whole or in part, any trust created by this instrument other than the Disclaimer
Trust, which shall be irrevocable and not subject to amendment. After the death of theSan Lee and Mui Chow Lee Revocable Trust
surviving settlor, none of the trusts created by this instrament may be amended, revoked, or
terminated.
3.3. Method of Revocation or Amendment. Any amendment, revocation, or
termination of any trust created by this instrument shall be made by written instrument signed
by both settlors or by the settlor making the revocation, amendment, or termination, and
delivered to the trustee. If the instrument making the revocation, amendment, or termination
is signed by only one settlor and the other settlor is living at that time, a copy of the
instrument making the amendment, revocation, or termination shall also be delivered to the
other settlor. An exercise of the power of amendment substantially affecting the duties,
rights, and liabilities of the trustee shall be effective only if agreed to by the trustee in
writing.
3.4. Delivery of Property After Revocation. After any revocation or termination
with respect to community property, the trustee shall promptly deliver the designated
property to the settlors. Unless otherwise provided in the revocation or this trust instrument,
any community property so returned shall continue to be the community property of the
settlors. After any revocation or termination with respect to separate or quasi-community
property, the trustee shall promptly deliver the designated property to the contributing settlor.
3.5. Trustee’s Retention of Assets on Revocation. In the event of any revocation of
all or part of the trust, the trustee shall be entitled to retain sufficient assets to reasonably
secure the payment of liabilities the trustee has lawfully incurred in administering the trust
and any fees that have been earned by the trustee, until such time as those liabilities have
4San Lee and Mui Chow Lee Revocable Trust
been discharged and fees paid, unless the settlors indemnify the trustee against loss or
expense.
3.6. Settlors’ Power to Direct Investments While Both Settlors Are Living.
Notwithstanding any other provision in this instrument, during the joint lifetimes of the
settlors, the settlors shall have the power to direct trust investments, which is defined as the
power to direct the trustee to do any or all of the following:
(a) Invest trust funds in specified securities, properties, or other forms of
investment;
(b) Retain as part of the trust estate, for specified periods of time, securities,
Properties, or other forms of investment held in trust under this instrument;
(c) Sell, encumber, lease, abandon, or dispose of any trust property.
Any such directions with respect to any portion of the trust estate that is the settlors’
community property may be given only by the settlors acting jointly. Any such directions
with respect to any portion of the trust estate that is separate or quasi-community property of
one settlor may be given unilaterally by that settlor, and in no event may be given by the
other settlor, unless the other settlor is empowered to do so under Section 3.10 of this
instrument as an attorney in fact or conservator for the settlor who owns the separate
property. If the trust property is invested in accordance with the terms of the written
direction, the trustee shall not be liable for losses sustained as a direct or indirect result of
the trustee’s compliance with that direction. All directions shall be in a writing signed by the
settlor or settlors having the power to give the direction, specifying, if applicable, the periodSan Lee and Mui Chow Lee Revocable Trust
of time during which the instructions shall remain in effect and describing any other
conditions affecting the directions.
3.7. Power to Direct Investments After Death of Deceased Settlor. After the death
of the deceased settlor, the surviving settlor shall have the power to direct trust investments
(as defined in the previous section) of any trust created under this instrument other than the
Disclaimer Trust. No person shall have the power to direct trust investments of the
Disclaimer Trust. After the death of the surviving settlor, no person shall have the power to
direct trust investments.
3.8. Setilors’ Power to Borrow From Trust Estate While Both Settlors Are Living.
Notwithstanding any other provision in this instrument, during the joint lifetimes of the
settlors, income or principal of the trust estate may be borrowed with or without security, as
provided in this section. The loans shall be in such amounts and on such terms as specified
in a signed writing filed with the trustee.
(a) The settlors, acting jointly, shall have the power to borrow from the
portion of the trust estate that is the settlors’ community property. Both
settlors shall be required to sign the writing filed with the trustee.
(b) A settlor whose separate property or quasi-community property comprises
any portion of the trust estate shall have the power to borrow from that portion
of the trust estate.
3.9. Power to Borrow From Trust Estate After Death of Deceased Settlor. After the
death of the deceased settlor, the surviving settlor may borrow, with or without security,
from the income or principal of any trusts created under this instrument, other than theSan Lee and Mui Chow Lee Revocable Trust
Disclaimer Trust, such amounts on such terms as he or she specifies in a signed writing filed
with the trustee.
3.10. Exercise of Rights and Powers of Settlors By Others. Any right or power that
either settlor could exercise personally under the terms of this instrument, except the power
to amend, revoke, or terminate any trust created by this instrument, may be exercised for
and in behalf of that settlor by any attorney in fact who, at the time of the exercise, is duly
appointed and acting for that settlor under a valid and enforceable durable power of attorney
executed by that settlor under the Uniform Durable Power of Attorney Act, or any successor
statute, or, if there is no such attorney in fact, by a duly appointed and acting conservator of
that settlor, after petition to the court in accordance with California Probate Code Section
2580, or any successor statute. The power to amend, revoke, or terminate any trust created
by this instrument is personal to the settlors and may not be exercised by any other person or
entity.
ARTICLE FOUR
DISTRIBUTIONS DURING SETTLORS’ JOINT LIVES
4,1. Payment of Income During Settlors’ Joint Lives. So long as both settlors are
living, the trustee shall pay the net income of the trust as specified in this section.
(a) Community Property. The trustee shall pay to or apply for the benefit of
the settlors, or either of them, all of the net income from the trust community
property, in monthly or other convenient installments (but not Jess often than
annually) as the settlors, or either of them, and the trustee may agree on from
time to time.San Lee and Mui Chow Lee Revocable Trust
C
(b) Separate and Quasi-Community Property. The trustee shall pay to or
apply for the benefit of a settlor whose separate property or quasi-community
property comprises part of the trust estate all of the net income from that
property, in monthly or other convenient installments (but not less often than
annually) as that settlor and the trustee may agree on from time to time.
4.2. Distributions of Principal During Settlors’ Joint Lives. So long as both settlors
are living, the trustee shall distribute principal of the trust, at any time or times, as specified
in this section.
(a) Community Property. The trustee shall distribute to or apply for the
benefit of the settlors, or either of them, as much of the principal of the
community property of the trust as the trustee, in the trustee’s discretion,
deems necessary for the comfort, welfare, and happiness of the settlors, or
either of them.
(b) Separate and Quasi-Community Property. The trustee shall distribute to
or apply for the benefit of either settlor as much of the principal of the
separate and quasi-community property of that settlor as the trustee, in the
trustee’s discretion, deems proper for the comfort, welfare, and happiness of
that settlor.
(©) Consideration of Other Resources When Distributing Principal. In
exercising discretion under subsections (a) and (b), the trustee shall give the
consideration that the trustee deems proper to all other income and resources
then readily available for use by the settlor or settlors, as the case may be, for
the stated purposes and that are then known to the trustee. All decisions of the
trustee regarding such payments, if any, are within the trustee’s discretion and
shall be final and incontestable by anyone.
4.3. Distributions of Principal at Request of Settlors. So long as both settlors are
living, the settlors shall have the right to withdraw principal of the trust, at any time or time,
as specified in this section.
(a) Community Property. The trustee shall distribute to the settlors, or either
of them, such amounts from the principal of the community property of theSan Lee and Mui Chow Lee Revocable Trust
trust, up to the whole thereof, as the setilors, or either of them, may request
of the trustee in writing.
(b) Separate and Quasi-Community Property. The trustee shall distribute to a
settlor whose separate or quasi-community property comprises part of the trust
estate as much of the principal of that property, up to the whole thereof, as
that settlor may request of the trustee in writing.
4.4. Settlors’ Obligation for Community Property Distributed. Any payment of
income or principal from the trust community property to or for the benefit of the settlors, or
either of them, shall remain the community property of the settlors. A settlor who receives
any such payment shall have the same obligations respecting that property that he or she
would have with respect to all community property generally.
4.5. Requests in Behalf of a Settlor Unable to Do So Personally. If, at any time,
either settlor is unable personally to make a request of the trustee to withdraw principal of
the trust, that settlor’s right to make the request may be exercised for or in behalf of that
settlor by an attorney in fact who, at the time of the exercise, is duly appointed and acting
for that settlor under a valid and enforceable durable power of attorney executed by the
settlor under the Uniform Durable Power of Attorney Act, or any successor'statute. If there
is no such attorney in fact, then the trustee shall have the discretion to make any principal
distribution to or for the benefit of that settlor that the settlor could have requested personally
if he or she were able to do so. In making any principal distribution under this section
(whether pursuant to a request by an attorney in fact or not), the trustee shall pay as much of
the principal as the trustee, in the trustee’s discretion, deems necessary for that settlor’s
health, education, support, and maintenance. The trustee shall have discretion to determine
9C~
San Lee and Mui Chow Lee Revocable Trust
when a settlor is unable personally to request principal payments from the trustee for
purposes of this section.
ARTICLE FIVE
DISTRIBUTIONS AFTER DECEASED SETTLOR’S DEATH
5.1. Payment of Death Taxes, Debts and Expense s on Statement From Personal
Representative. After the deceased settlor’s death, on receipt by the trustee of a written
statement from the personal representative of the deceased settlor’s estate requesting that the
trustee pay death taxes, debts, and expenses (as defined in Article Eight), with respect to any
property in the deceased settlor’s estate, the trustee shall pay, either directly or to the
personal representative, any amounts requested by the personal representative for those
purposes, in the manner specified below. The trustee may rely on the personal
representative’s statement and shall not be liable for any act or omission by the personal
representative in protesting or failing to protest the legality, propriety, or amount of the death
taxes, debts, or expenses. If there is no personal representative, the trustee shall make the
payments directly. Payments of debts and expenses shall be made by the trustee from the
trust estate. All death taxes payable by reason of the death of the deceased settlor shall also
be paid by the trustee from the trust estate. Payments under this section on the death of the
deceased settlor shall be made only out of (1) the deceased settlor’s separate property, if any,
(2) the deceased settlor’s one-half (1/2) interest in the settlors’ community property, and (3)
the deceased settlor’s one-half (1/2) interest in the deceased settlor’s quasi-community
10
uASan Lee and Mui Chow Lee Revocable Trust
property, and shall not be made from the surviving settlor’s property. Any death taxes that
are attributable to a disclaimer of property under this instrument by the surviving settlor shall
be paid from the Disclaimer Trust.
5.2. Trustee’s Power to Defer Division or Distribution. Whenever the trustee is
directed to divide any part of the trust estate or distribute trust assets on the death of either
settlor, the trustee may, in the trustee’s discretion, defer actual division or distribution for a
period not exceeding six (6) months after that settlor’s death. The ability of the trustee to
delay division or distribution shall not affect the vesting of interests, which shall be as of the
date of death.
5.3. Trust Estate Allocated to Power of Appointment Trust. On the deceased
settlor’s death, the remaining trust estate shall be held, administered, and distributed
according to the terms of the Power of Appointment Trust, as set forth in Article Six.
5.4, Intention That Disposition Qualify for Marital Deduction. The settlors intend
that the disposition of the trust estate set forth in the preceding section (to the extent that it
provides for disposition of the deceased settlor’s property) qualify for the federal estate tax
marital deduction, and this instrument shall be construed accordingly.
5.5. Disclaimer of Property. Any property or portion of property that is disclaimed
by the surviving settlor shall be held, administered, or distributed according to the terms of
the Disclaimer Trust, as set forth in Article Six.
11San Lee and Mui Chow Lee Revocable Trust
ARTICLE SIX
DISPOSITIVE PROVISIONS OF TRUSTS CREATED
AFTER DECEASED SETTLOR’S DEATH
6.1. Power of Appointment Trust. The trustee shall hold, administer, and distribute
the assets of the Power of Appointment Trust as follows:
(a) Payment of Income. The trustee shall pay to or apply for the benefit of
the surviving settlor, so long as the surviving settlor lives, the entire net
income of the trust, in monthly or other convenient installments agreed on by
the surviving settlor and the trustee, but not less often than annually. In
determining the net income of the trust distributable to the surviving settlor,
the trustee shall include all income that must be considered as income in order
for the trust to qualify for the marital deduction under the federal estate tax
law, and shall make no deductions from gross income that would prevent the
trust from: qualifying for that marital deduction, notwithstanding any contrary
provisions of this instrument or any applicable provisions of state law. It is
the intention of the settlors that the surviving settlor, as the beneficiary of a
marital deduction trust, shall have substantially that degree of beneficial
enjoyment of the trust during his or her lifetime that the principles of the law
of trusts accord to a person who is unqualifiedly designated as the life
beneficiary of a trust, and the trustee shall not exercise the trustee’s discretion
in a manner that is not in accord with this expressed intention. It is also the
intention of the settlors that the trust produce for the surviving settlor during
his or her lifetime the income, or that the surviving settlor shall have the
benefit of the trust property, as is consistent with the value of the trust
property and with its preservation.
(b) Discretionary Payment of Principal by Trustee. At any time or times
during the trust term, the trustee shall pay to or apply for the benefit of the
surviving settlor so much of the principal of the trust as the trustee deems
proper for the comfort, welfare, and happiness of the surviving settlor. In
exercising discretion, the trustee shail give the consideration that the trustee
deems proper to all other income and resources that are then known to the
trustee and that are readily available to the surviving settlor. All decisions of
the trustee regarding payments under this subsection, if any, are within the
trustee’s discretion and shall be final and incontestable by anyone.
~San Lee and Mui Chow Lee Revocable Trust
(c) Right of Surviving Settlor to Withdraw Principal. The trustee shall pay to
the surviving settlor as much of the trust principal as the surviving settlor may
from time to time demand in a signed writing delivered to the trustee.
(d) General Power of Appointment. On the death of the surviving settlor, the
trustee shall distribute all property subject to the trust (including the trust
principal, all net income then held by the trustee, and all income then accrued
but not collected by the trustee) to any entity or entities, person or persons,
and on any trust, terms and conditions, or to or in favor of the estate of the
surviving settlor, as the surviving settlor may direct by will, but only if that
will expressly refers to and indicates an intention to exercise this power of
appointment. The trustee may rely on any instrument admitted to probate as
the last will of the surviving settlor in carrying out the terms of the power of
appointment and shall not be liable for any good-faith act in reliance on that
will, even if for any reason it is later determined to be invalid with respect to
its purported exercise of this power of appointment. If the trustee receives no
notice of the existence of a will of the surviving settlor within six (6) months
after the death of the surviving settlor the trustee may distribute the trust assets
and income as though this power of appointment had not been exercised and
shal in that event be conclusively presumed to have acted in good faith, even
if a valid will is thereafter discovered.
(e) Payment of Death Taxes, Debts. and Expenses. On the death of the
surviving settlor and subject to any power of appointment exercised by him or
her, the trustee, in the trustee’s discretion, may pay out of the income or
principal (or partly from each) of the Power of Appointment Trust the death
taxes, debts, and expenses (as defined in Article Eight) arising on the death of
the surviving settlor unless the trustee determines that other adequate
provisions have been made for the payment of these taxes, debts, and
expenses.
(f) Default Provision. If any of the property subject to the power of
appointment of the surviving settlor is not effectively appointed by him or her,
that property, after payment of any taxes, debts, and expenses pursuant to the .
applicable provisions of this instrument, shall be distributed to the Disclaimer
Trust, to be held, administered, and distributed as part of the Disclaimer
Trust.
13San Lee and Mui Chow Lee Revocable Trust
6.2. Disposition of Disclaimer Trust Until Death of Surviving Settlor. During the
lifetime of the surviving settlor, the trustee shall hold, administer, and distribute the assets of
the Disclaimer Trust as follows:
(a) Payment of Income. The trustee shall pay to or apply for the benefit of
the surviving settlor the entire net income of the trust, in monthly or other
convenient installments as agreed on by the surviving settlor and the trustee,
but not less often than annually.
Discretionary Payment of Princi Trustee. At any time or times
during the trust term, the trustee shall pay to or apply for the benefit of the
surviving settlor so much of the principal of the trust as the trustee deems
proper to pay the reasonable expenses of the surviving settlor for his or her
health, education, support, and maintenance. In exercising discretion, the
trustee shall give the consideration that the trustee deems proper to all other
income and resources that are known to the trustee and that are readily
available to the surviving settlor for use for these purposes. All decisions of
the trustee regarding payments under this subsection, if any, are within the
trustee’s discretion and shall be final and incontestable by anyone.
6.3. Disposition of Disclaimer Trust on Death of Surviving Settlor.
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WON SUPERIOR COURT OF CALIFORNIA COUNTY OF SAN FRANCISCO Document Scanning Lead Sheet Oct-10-2012 10:53 am Case Number: PTR-12-296124 Filing Date: Oct-10-2012 10:49 Filed by: NOELIA RIVERA Juke Box: 001 Image: 03796171 PROBATE EX PARTE APPLICATION FOR ORDER (HEARING) IN THE MATTER OF THE SAN LEE et al TRUST 001P03796171 Instructions: Please place this sheet on top of the document to be scanned.Solan, Park & Robello LLP on Oa &F WN = = oOo o 11 ¥ Sheila K. Robello, Esq. (SBN 209300) San Francisco County Superior Court Deborah L. Fox, Esq. (SBN 233415) we prunes SOLAN, PARK & ROBELLO, LLP OCT FU Zulg 354 Pine Street, Fifth Floor San Francisco, California 94104 RK OF i = COURT Telephone: 415/777-3300 By: Facsimile: 415/777-3301 Deputy Clerk Attorneys for Petitioner and ooo 16 2012 Proposed Successor Trustee Leo F. Bautista SUPERIOR COURT OF CALIFORNIA COUNTY OF SAN FRANCISCO IN RE CASENO. PTRo -12-2961e2 qleignature by Facsimile] PETITION FOR ORDER APPOINTING LEO F. BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGING TRUST UNDER CONTINUING COURT San Lee and Mui Chow Lee SUPERVISION; WAIVING Revocable Trust u/d/t dated March ACCOUNTINGS AND TRUSTEE’S 24 1985, as amended December BOND AND ORDER DIRECTING 22, 2004 FORMER TRUSTEE STO TRANSFER ALL TRUST PROPE TO SUCCESSOR TRUSTEE [PC §17200, 15660] 4 ATE: TIME: 9:00 a.m. DEPT: Probate, Room 204 Leo Bautista submits this Petition for Order Appointing Leo F. Bautista as Successor Trustee and Bringing Trust Under Continuing Court Supervision; Waiving Accountings and Trustee's Bond and Order Directing Former Trustee(s) to Transfer All Trust Property to Successor Trustee. Petitioner alleges as follow: 1. History of Proceedings. San Lee and Mui Chow Lee, husband and wife, and herein after referred to as “settlors” created that San Lee and Mui Chow Lee Revocable trust on March 24, 1985. Thereafter the trust was amended on November 15, 1996, January 23, 1998, July 21, 1999 and July 13, 2002. On PETITION FOR ORDER APPOINTING LEO F. BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGING TRUST UNDER CONTINUING COURT SUPERVISION; WAIVING ACCOUNTINGS AND TRUSTEE’S BOND; ETC.Solan, Park & Robello LLP December 22, 2004 Mui Chow Lee, the surviving settlor, executed a fifth amendment to the trust. This amendment revoked all prior amendments (amendments 1 through 4). 2. The trust currently consists of the San Lee and Mui Chow Lee Revocable Trust u/d/t dated March 24, 1985 (the Trust) and the Fifth Amendment to Declaration of Trust dated December 22, 2004 (Fifth Amendment). A copy of the trust and the Fifth Amendment are attached hereto as Exhibits A and B respectively. 3. San Lee died on October 4, 1998. 4. Mui Chow Lee died on November 25, 2009. 5. Crystal H. Chow was named as the successor trustee under Article 7.2 of the trust, as amended in the Fifth Amendment to the Declaration of trust as follows: 2. Paragraph 7.2 of Article Seven commencing on page 18 of said Trust shall be revoked in its entirely and be replaced by the following: 7.4 (Sic) Successor Trustees. If the office of trustee becomes vacant by reason of death, incapacity, or an’ other reason, and no successor trustee or cotrustees have been designated under any other provision of this trust instrument, the following, in the order of priorty indicated, shall be trustee: First, Crystal H. Chow, settlor Mui Chow Lee's niece; Second, Jeanette Lau St. Onge, settlor Mui Chow Lee’s niece. If all those named above are unwilling or unable to serve as successor trustee, a new trustee or cotrustees shall be appointed by majority vote of the adult beneficiaries fo the trust who are then entitle to receive income under the trust, or who would be entitled to receive a distribution of principal from the trust if the trust were then terminating, and who then have the legal capacity to give such a vote, if a majority of the beneficiaries are unable to agree on a new trustee or cotrustees, a new trustee or cotrustees may be appointed by the court. 5. Crystal Chow served as successor trustee from January 2010 to February of 2012, represented by Katherine Yee, Esq. In January of 2012 she prepared and served upon the named successor trustee Jeanette Lau St. Onge, a written resignation which made her resignation effective on February 29, 2012. PETITION FOR ORDER APPOINTING LEO F. BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGING TRUST UNDER CONTINUING COURT SUPERVISION; WAIVING ACCOUNTINGS AND TRUSTEE’S BOND; ETC. - 2 -Solan, Park & Robello LLP aon On a kwWN = NHN NY YN NNN SEA seeereapAt2as &®Woakhk ON A OO ON OA WN B= CO OC to serve or to take on the role of successor trustee. at Article 6, Paragraph 6.1 (f) that: (f) On the death of the survivin: settlor, the entire remaining principal of the Power of Appointment Trust, all net income then held y the trustee, and all income then accrued but not collected by the trustee, after any payment of taxes, debts , and expenses ursuant to the applicable provisions of this instrument, m (sic) shall be distributed as follows: (1) Upon the death of the Settlor, if either the settlor’s brother Choung Yee Chow (choung Yee”) or the settlor's nephew, Brian Leland Chow (“Brian”) shall then be living, then the trustee shall retain any interest in that certain real property commonly known as 134 Athens Street, San Francisco, California which is then a part of the trust estate (herein after “the premises”) in a se arate trust to be administered as set forth below in this subparagrap! (y(t) of Paragraph 6.1 f Article Six. Such trust, if created shal referred to as the “House Trust.” If no interest in said real property shall be a part of the trust estate at the time of the settlor's death , then the House Trust Shall not be created, and the premises shall augment the balance of the trust estate and shall be distributed as set forth below in subparagraphs (B) through (D) of this Paragraph 6.1 of Article Six. (1.1) If the House Trust is created, then during the term of the House Trust, the settlor’s brother Choung Yee and the settlor's nephew, Brian shall have the right to occupy the premises free fo rent. Any unoccupied portions fo the premises May be rented out. During the term of the House Trust, the trustee shall pay for an property taxes, assessments, insurance, maintenance, and ordinary repairs on the premises from the above rental income, if any. occupying parties shall pay any balance of the property taxes, assessments, insurance maintenance, and ordinary repairs on the premises not paid with the above said rental income, t parties are unable to pay for the property taxes, assessments insurance maintenance and ordinary repairs on the premises, then the trustee shall pay for the above from the funds in the Expense rust below. (1.2) Notwithstanding any other provision contained in this the House Trust. Mt .3) The House Trust shall terminate upon i) the death of the second of Choung Yee and Brian’s death, or il) upon written notice PETITION FOR ORDER APPOINTING LEO F. BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGIN' UNDER CONTINUING COURT SUPERVISION; WAIVING ACCOUNTINGS AND TRUSTEE’S BOND> Ms. Chow also made repeated request to Jeannette Lau St. Onge to either decline 6. To date Jeannette Lau St. Onge has failed to assume the role of successor trustee, to the clear detriment of the trust estate and its beneficiaries. 7. Dispositive Provisions of the Trust. The Fifth Amendment provides hereinafter be the occupying Declaration, the trustee shall not sell the premises during the term of IG TRUST €.Solan, Park & Robello LLP oN Oa fk WN = form both Choung Yee and Brian that they no longer wishes to occupy said premises, whichever is later. Upon such termination, the trustee shail sell the above said premises. The trustee shall pay for the expenses of the last illness and funeral of both Choung Yee Chow and Brian Leland Chow, whenever the last illness and funeral occurs, out of the principal of the trust; unless the trustee determines that other adequate provisions have been made for payment of these expenses. 8. The settlor’s brother, Choung Yee died on July 31, 2011. 9. Brian Leland Yee (Brian) survived the settlors and resides in the trust property at 134 Athens Street, San Francisco, CA (Athens Street). 10. Financial Position of Trust. The trust currently contains only the Athens Street property in which Brian resides. Pursuant to the terms of the trust at Article 6, Subparagraph 6.1 (f) section 1.1 ... During the term of the House Trust, the trustee shall pay for any property taxes, assessments, insurance, maintenance, and ordinary repairs on the premises from the above rental income, ifany. The occupying parties shall pay any balance of the property taxes, assessments, insurance maintenance, and ordinary repairs on the premises not paid with the above said rental income, if the occupying parties are unable to pay for the property taxes, assessments insurance maintenance and ordinary repairs on the premises, then the trustee shall pay for the above from the funds in the Expense Trust below. Choung Lee made payment of approximately $1,060 from April 2010 to July 2011. Brian Lee made payment of $640 with the last payment of $140 being made in December 2011. However, these payments were insufficient to make payment in full on the property taxes and there is currently a delinquent tax bill in excess of $10,900. See Schedule of payment attached hereto as Exhibit Cc. There are no assets to maintain the property or pay for taxes or insurance. In fact, former trustee Crystal Chow has expended approximately $4,500 of her personal funds for attorney fees and payment of expenses of the trust including property insurance and utility bills, see Exhibit D attached hereto and incorporation herein for all purposes showing payment made by former trustee, Crystal Chow. 11. Vacancy in Office of Trustee and Need for Immediate Administration of Trust. Crystal Chow resigned as trustee on January 29", 2012 PETITION FOR ORDER APPOINTING LEO F. BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGING TRUST UNDER CONTINUING COURT SUPERVISION; WAIVING ACCOUNTINGS AND TRUSTEE’S BOND; ETC. ~~Solan, Park & Robello LLP with 30 day notice. Her resignation was thus effective at the end of February 2012. Despite over eight months having passed, Jeanette Lau St. Onge, the named successor trustee has failed to act. Accordingly, there is a vacancy in the office of trustee. It is necessary that a successor trustee be appointed immediately to address the status of the trust, ensure that the trust property is secured, insured land properly managed and to develop a pian to pay the expenses of the property and of the trust administration. Specifically, the following issues must immediately be addressed to property the trust property from liability. i) Unauthorized Rental of Trust Property. Petitioner is informed and believes that Brian resides in the real property and rents out space in the home to tenants. Despite repeated requests from the former trustee, Crystal Lee, the rental incomes are not turned over to the trustee or used to pay the expenses of the property. The former trustee has also been contacted by an individual who claims to be a legal tenant with complaints that Brian has stolen his rent money and demanding a formal lease agreement. This situation illustrates another liability for ithe estate which has the potential to negatively impact both the current beneficiary Brian and the residuary beneficiaries ii) Outstanding Property Tax liability. Petitioner is informed and believes that there is currently an outstanding property tax bill in excess of $10,900 due October 31, 2012. As the successor in interest to the property are not children, grandchildren or parents of the settlors the property tax has been reassessed and supplemental taxes have been assessed and are now due. iii) Violation of Local Ordinances. San Francisco has also sent four warnings letters in the last six months to the former trustee as Brian, and/or his roommates, leave garbage cans and garbage outside of the house in violation of city ordinance. Petitioner is also informed and believes that the property is well known to local law enforcement agencies PETITION FOR ORDER APPOINTING LEO F. BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGING TRUST UNDER CONTINUING COURT SUPERVISION; WAIVING ACCOUNTINGS AND TRUSTEE’S BOND; ETC, - 5 -Solan, Park & Robello LLP ont oa Fk WON = oO 10 iv) Lack of cooperation from beneficiary Brian. Petitioner is informed land believes that the former trustee, Crystal Chow, was unable to work with Brian las the trust beneficiary to resolve the financial issues of the trust and that in fact she feared for her safety if she confronted Brian. Petitioner is informed and believes that a neutral professional trustee is necessary to immediately address the issues that must be faced in the administration of this trust. 12. Trust Provisions Relating to Interests of Remainder Beneficiaries. While Brian is the current beneficiary of the House Trust (as discussed pelow) the trust also has four named remainder beneficiaries: Crystal Chow, Jeanette Lau St. Onge, Fiona Chow and Justin Chow. Therefore, the trustee of the this trust must consider the impact of the remainder beneficiaries of decisions made during the trust administration. Pursuant to Article 6, Paragraph 6.1(f)(1) (1.4) of the trust if the Athens Street property is part of the trust estate a “house trust’ is to be established and during the lives of Choung Lee and/or his son Brian Lee they are entitled to live in the house rent free. The trust provides two means by which the House trust may terminate making the remainder beneficiaries entitled to the proceeds. The first is on the death of Brian. If Brian dies than the property shall be sold and the net proceeds of the sale lof the house shall be distributed: $50,000 to the settlor’s grandniece, Fiona Chow, $50,000 to the settlor’s grandnephew, Justin Chow and the balance of the proceeds to the settlor’s nieces Crystal H. Chow and Jeanette Lau St. Onge. The second way to terminate the trust is if Brian no longer wishes to reside in the property. In that case the property is to be sold and the net proceeds of the property shall distributed, pursuant to Article 6, Paragraph 6.1(f)(1) (1.5) as follows: $50,000 to the settlor’s grandniece, Fiona Chow, $50,000 to the settlor's grandnephew, Justin Chow , $70,000 in trust for Brian, and the balance of the proceeds outright and free of trust to Settlor Mui Chow Lee’s brother Choung Yee PETITION FOR ORDER APPOINTING LEO F. BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGING TRUST UNDER CONTINUING COURT SUPERVISION; WAIVING ACCOUNTINGS AND TRUSTEE'S BOND; ETC. -0-Solan, Park & Robello LLP omnrt aa rk wr = NNN NNNNHNN A SFPeFeePeePaaA2rs eo utrauak ON 23 FO BANDA ODN = CO Chow, settlors nieces, Crystal H. Chow and Jeannette Lau St. Onge. If any of the above named three individuals shall be deceases at the time of the surviving settlor’s death, then his or her share of said net proceeds from the sale of said trust property of the House Trust shall be distributed to the survivor of them.’ As outlined in Paragraph 11 above there are issues such as payment of property insurance and taxes that must be immediately address and that have an impact on not only Brian but potentially on the residuary beneficiaries should the property be the subject of a tax sale or should the become damaged while there is no insurance in place. 13. Request that trust be brought under continued court supervision. Given the past difficulties with the administration of this trust and the bevy of serious outstanding issues, such as payment of delinquent property taxes and of laddressing the rental of the property, Petitioner submits that the trust should be brought under the continued supervision of the court. 14. Waiver of Trustee Bond and Trust Account. As the trust currently contains only the real property located 134 Athens Street and no liquid assets, Petitioner believes that is is appropriate to waive bond and an accounting at this time. Should additional assets be located or should the trust property begin to generate income, Petitioner will submit an ex parte application for a bond and a date for an accounting to be set in this matter. 15. Nomination of Leo Bautista. A majority of the adult beneficiaries of the trust have nominated Leo Bautista to serve as successor trustee. The nominations of Fiona Chow, Justin Chow and Crystal Chow are filed under __ ‘This section of the trust provides two different dispositive provisions, within the same paragraph, should Chystal Chow, Choung Lee or Jeanette Lau St. Onge predecease the surviving settlor. The first is that their share shall go equally to the survivor of them and the second is that their share shall go outright to their issue. Petitioner believes that the correct provision is that the share is distributed to the survivor of them. Otherwise this section would be in direct conflict with the special needs trust provision fou nd in the trust for Choung Lee son, Brian. PETITION FOR ORDER APPOINTING LEO F. BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGING TRUST UNDER CONTINUING COURT SUPERVISION; WAIVING ACCOUNTINGS AND TRUSTEE’S BOND; ETC. - 7-Solan, Park & Robello LLP separate cover. Petitioner is informed and believes that Jeannette Lau St. Onge and Brian Chow will not be filing nominations. 16. Trust Beneficiaries. The names, ages and addresses of the beneficiaries of the trust as known to petitioner are: Brian Leland Chow adult 134 Athens Street San Francisco, CA 94112 Fiona Chow adult 9961 Waxberry Court Las Vegas, NV 89178 Justin Chow adult 9961 Wax berry Court Las Vegas, NV 89178 Crystal Chow adult 125 Olmstead Street, San Francisco, CA 94134 Jeannette Lau St Onge adult 1893 Sweetwood Drive Daly City, CA 94015 17. Request for Special Notice. No request for special notice have been filed. Notice of this hearing will be provided as required by law. Wherefore Petitioner request an order that: 1. Notice of the hearing on this petition has been given as required by law land no further or other notice is required; 2. Leo F. Bautista is appointed as sole successor trustee of the Trust; 3. The San Lee and Mui Chow Lee Revocable Trust u/d/t dated March 24 1985, as amended December 22, 2004 , is brought under the continuing supervision of this Court; 4. The Trustee’s bond is waived; 5. Accountings are waived until such time as the trust estate generates income or the real property is liquidated; 6. Court authority is required prior to the trustee taking any of the following acts: amending or revoking of the Trust; making gifts from the Trust estate; making sales of real property of the Trust, which sales shall also require Court PETITION FOR ORDER APPOINTING LEO F. BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGING TRUST UNDER CONTINUING COURT SUPERVISION; WAIVING ACCOUNTINGS AND TRUSTEE’S BOND; ETC. -O-18/18/2012 69:25 51g8434AA4 BAUTISTA BAUTIST“ PAGE 91/43 + Iconfirmation, or encumbering real property of the Trust; and making payment of 2 compensation to the successor trustee and the successor trustee's attorney, Sie 4 7. Former trustee, Crystal Chow, is directed to tum over all assets of the § lfrust, including records and tax documents, to successor trustee Leo F. Bautista; 6 8. For such other or additional orders as the court finds necessary. 7 Respectfult & 9 Leo Fr, Bautista, Petitioner and Proposed 10 Successor Trustee W Solan, Park & Robello LLP 12 ym - < Ate + Rbile 13 ‘Shella K. Robello, Attomey for Leo F. 44 , Bautista 15 16 17 18 19 20 21 22 23 Solan, Park & PETITION FOR ORDER APPOINTING LEO F. BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGING TRUST Robeilo LLP . |] UNDER CONTINUING COURT SUPERVISION; WAIVING ACCOUNTINGS AND TRUSTEE’S BOND; ETC. - ~~18/18/2812 @9:25 §1684348n4 BAUTISTA BAUTISTS PAGE 62/83 ‘Solan, Park & Robetlo LLP oo N OD HH AF WO NM mm MY YH RON NN BNMBRBRBBNBSSGAaASAREBRAS VERIFICATION |, Leo F. Bautista, am the proposed successor trustee of the San Lee and Mui how Lee Revocable Trust u/d/t dated March 24 1985, as amended December 22, 004. | have read the foregoing document entitled PETITION FOR ORDER PPOINTING LEO F. BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGING RUST UNDER CONTINUING COURT SUPERVISION; WAIVING IACCOUNTINGS AND TRUSTEE’S BOND AND ORDER DIRECTING FORMER TRUSTEE(S) TO TRANSFER ALL TRUST PROPERTY OVER TO SUCCESSOR TRUSTEE and know its contents. The matters stated therein are true of my own knowledge, save and accept those matters stated on information and belief, and, as to knose matters, | believe them to be true. 1 declare under penalty of perjury under the laws of the State of Catifornia that the regoing is true and correct. PETITION FOR ORDER APPOINTING LEO F, BAUTISTA AS SUCCESSOR TRUSTEE AND BRINGING UNDER CONTINUING COURT SUPERVISION; WAIVING ACCOUNTINGS AND TRUSTEE'S BOND; ETC. - 10 ~SAN LEE AND MUI CHOW LEE REVOCABLE TRUST . Table of Contents ARTICLE ONE CREATION OF TRUST Declaration... ee ee ee Names of Trusts... ee ee Effective Date... ee ee eee No Living or Deceased Children «6... eee et eee Definition of Issue 2... ee ee Pete ee eee ARTICLE TWO TRUST ESTATE Definition of Trust Estate 20. eee Character of Trust Assets... ee eee Nonprobate Transfers of Community Property... .. . Lee Additions to Trust... 0 ee ee ARTICLE THREE RIGHTS AND POWERS OF SETTLORS Power of Revocation While Both Settlors Are Living .......-..--.---- Power of Revocation and Amendment After Death of Deceased Settlor..... ... Method of Revocation or Amendment .... 2.2... 6.2. e ee eee eee eee Delivery of Property After Revocation ©... -... eee eee eee ee Trustee’s Retention of Assets on Revocation... .. 6... 6+ ee eee ee cae Settlors’ Power to Direct.Investments While Both Settlors Are Living ....... Power to Direct Investments After Death of Deceased Settlor ..........-.- Settlors’ Power to Borrow From Trust Estate While Both Settlors Are Living . . . Power to Borrow From Trust Estate After Death of Deceased Settlor........ Exercise of Rights and Powers of Settlors By Others... .-..------+e0s ARTICLE FOUR DISTRIBUTIONS DURING SETTLORS’ JOINT LIVES Payment of Income During Settlors’ Joint Lives .. 0... 6. ee eee eee Distributions of Principal During Settlors’ Joint Lives ....-...--.--+-+--- Distributions of Principal at Request of Settlors ........-.---- +++ --e- Settlors’ Obligation for Community Property Distributed .....-....-+.-- - Requests in Behalf of a Settlor Unable to Do So Personally ...-...-- tabbies* EXHIBIT AARTICLE FIVE DISTRIBUTIONS AFTER DECEASED SETTLOR’S DEATH Payment of Death Taxes, Debts, and Expenses on Statement From Personal Representative 2.0... ee eee ee tte 10 Trustee’s Power to Defer Division or Distribution ......-...----.+-+- 11 Trust Estate Allocated to Power of Appointment Trust........-.-.50-6- 11 Intention That Disposition Qualify for Marital Deduction ............-.- i Disclaimer of Property... . 2... eee es 11 ARTICLE SIX . DISPOSITIVE PROVISIONS OF TRUSTS CREATED AFTER DECEASED SETTLOR’S DEATH Power of Appointment Trust... 1... eee eee 12 Disposition of Disclaimer Trust Until Death of Surviving Settlor .......... 14 Disposition of Disclaimer Trust on Death of Surviving Settlor ............ 14 Trust for Fiona 6. ee 17 Spendthrift Clause ©... eee 17 ARTICLE SEVEN TRUSTEE Remaining Settlor-Trustee Serves Alone ... 2.1... 6 ee ee ee ees 18 Successor Trustees 22... ee ee ee 18 Definition of Trustee 2... eee 19 Removal and Replacement of Trustee ...- 2... eee eee 19 Waiver of Bond 2... 0. ee ee 19 Procedure for Resignation... 6... . ee eee 19 General Powers of Trustee 2.1... ee ee ee 20 Power to Retain Trust Property 2.2.6... eee ee tent 22 Trustee’s Power to Invest Property ©... .. 2.60 eee ee eee 22 Power Over Unproductive Property... 2.0... eee eee ee eee eee 22 Power to Operate Business . 2... ee 22 Power to Self-Deal ... 2.22. eee eet eee bees 23 Power to Combine Trust Assets 24 Division or Distribution in Cash or Kind ... 2... 2... ee ee ee eee eee 24 Payments to Legally Incapacitated Persons ... 6... 1... ee eee eee eee 24 Trustee’s Liability... ee 25 Written Notice to Trustee 2 2. ee ee 25 Duty to Account 2.2. ee eee 25 Cotrustee May Delegate Acts to Other Cotrustee .........----------- 25 ARTICLE EIGHT CONCLUDING PROVISIONS Perpetuities Savings Clause «6... eee 25 Simultaneous Death... ... ce eee eee eee ee eens 26 No-Contest Clause 2... et ee 26 "Deceased Settlor” and "Surviving Settlor” 2.2... eee 27Definitions of Death Taxes, Debts, and Expenses... 1.2... 0.0 e eevee 27 Definition of Education 2... 61. ce ee te eee 28 Captions 2... ee ee ete 28 Severability Clause 2... ee ee ee ee eee 28 California Law to Apply 2.0.6 ee ee ee 28 ARTICLE NINE SIGNATURE AND EXECUTION Execution 2.2 ee eee eee 29ee oo SAN LEE AND MUI CHOW LEE REVOCABLE TRUST ARTICLE ONE CREATION OF TRUST 1.1. Declaration. San Lee and Mui Chow Lee, husband and wife, of San Francisco County, California, who are herein referred to as "the settlors" or "the trustees,” depending on the context, hereby declare that they hold certain property (the “trust estate") in trust, to be held, administered, and distributed according to the terms of this instrument. 1.2. Names of Trusts. The trusts created by this instrument shall be known collectively as the San Lee and Mui Chow Lee Revocable Trust, and each separate trust created under this instrument shall be referred to by adding the name or designation of that separate trust as it appears in the appropriate section of this instrument. 1.3. Effective Date. This declaration shall be effective immediately on execution by all the parties. 1.4. No Living or Deceased Children. The settlors have no living or deceased children. 1.5. Definition of Issue. As used in this instrument, the term "issue" refers to all persons referred to in California Probate Code Section 50, as in effect at the time of the execution of this instrument.San Lee and Mui Chow Lee Revocable Trust ARTICLE TWO TRUST ESTATE © 2.1. Definition of Trust Estate. All property subject to this instrument from time to time is referred to as the "trust estate" and shall be held, administered, and distributed as provided in this instrument. The trustee shall hold, administer, and distribute the property described in the Schedule of Community Property Assets (which is attached hereto and made a part of this trust instrument), any other property that may be hereafter subject to this trust, and the income and proceeds attributable to all such property, in accordance with the provisions of this instrument. 2.2. Character of Trust Assets. All community property of the settlors transferred to € : this trust, and the proceeds of all such property, shall continue to be community property under the laws of California, subject to the provisions of this instrument. All separate and quasi-community property shall remain the separate or quasi-community property, respectively, of the contributing settlor. 2.3. Nonprobate Transfers of Community Property. The consent of the settlors to the transfer of any community property assets subject to this trust shall be governed solely by the terms of this trust instrument. California Probate Code Sections 5010 through 5032 (or any successor sections), dealing with nonprobate transfers of community property, shall be inapplicable to any trust created by this instrument. 2.4. Additions to Trust. From time to time, the trustee may accept additions to this trust from any source. All such additions shall become part of the trust estate and shall be 2San Lee and Mui Chow Lee Revocable Trust held, administered, and distributed in accordance with the terms of this instrument. That additional property shall become part of the trust estate on written acceptance of it by the trustee. Any additions to the trust shall be made by designating in writing the property to be added. However, the titling of any account, deed, or similar asset in the name of the trustee, as trustee of this trust, or any alternate or successor trustee acting under this instrument, shall be deemed to be a transfer to this trust. Any designation by a third party, whether by will, deed, account title designation, or similar transfer, shall also be a transfer to the trust estate. ARTICLE THREE RIGHTS AND POWERS OF SETTLORS 3.1. Power of Revocation While Both Setilors Are Living. During the joint lifetimes of the settlors, any trust created by this instrument may be amended, revoked, or terminated, in whole or in part, by either settlor acting alone, as to any separate and quasi-community property of that settlor and any community property of the settlors. However, any modification of the rights and interest of either settlor in community property during the marriage of the settlors may be made only with the joinder or consent of both settlors. 3.2. Power of Revocation and Amendment After Death of Deceased Settlor. After the death of the deceased settlor, the surviving settlor may at any time amend, revoke, or terminate, in whole or in part, any trust created by this instrument other than the Disclaimer Trust, which shall be irrevocable and not subject to amendment. After the death of theSan Lee and Mui Chow Lee Revocable Trust surviving settlor, none of the trusts created by this instrament may be amended, revoked, or terminated. 3.3. Method of Revocation or Amendment. Any amendment, revocation, or termination of any trust created by this instrument shall be made by written instrument signed by both settlors or by the settlor making the revocation, amendment, or termination, and delivered to the trustee. If the instrument making the revocation, amendment, or termination is signed by only one settlor and the other settlor is living at that time, a copy of the instrument making the amendment, revocation, or termination shall also be delivered to the other settlor. An exercise of the power of amendment substantially affecting the duties, rights, and liabilities of the trustee shall be effective only if agreed to by the trustee in writing. 3.4. Delivery of Property After Revocation. After any revocation or termination with respect to community property, the trustee shall promptly deliver the designated property to the settlors. Unless otherwise provided in the revocation or this trust instrument, any community property so returned shall continue to be the community property of the settlors. After any revocation or termination with respect to separate or quasi-community property, the trustee shall promptly deliver the designated property to the contributing settlor. 3.5. Trustee’s Retention of Assets on Revocation. In the event of any revocation of all or part of the trust, the trustee shall be entitled to retain sufficient assets to reasonably secure the payment of liabilities the trustee has lawfully incurred in administering the trust and any fees that have been earned by the trustee, until such time as those liabilities have 4San Lee and Mui Chow Lee Revocable Trust been discharged and fees paid, unless the settlors indemnify the trustee against loss or expense. 3.6. Settlors’ Power to Direct Investments While Both Settlors Are Living. Notwithstanding any other provision in this instrument, during the joint lifetimes of the settlors, the settlors shall have the power to direct trust investments, which is defined as the power to direct the trustee to do any or all of the following: (a) Invest trust funds in specified securities, properties, or other forms of investment; (b) Retain as part of the trust estate, for specified periods of time, securities, Properties, or other forms of investment held in trust under this instrument; (c) Sell, encumber, lease, abandon, or dispose of any trust property. Any such directions with respect to any portion of the trust estate that is the settlors’ community property may be given only by the settlors acting jointly. Any such directions with respect to any portion of the trust estate that is separate or quasi-community property of one settlor may be given unilaterally by that settlor, and in no event may be given by the other settlor, unless the other settlor is empowered to do so under Section 3.10 of this instrument as an attorney in fact or conservator for the settlor who owns the separate property. If the trust property is invested in accordance with the terms of the written direction, the trustee shall not be liable for losses sustained as a direct or indirect result of the trustee’s compliance with that direction. All directions shall be in a writing signed by the settlor or settlors having the power to give the direction, specifying, if applicable, the periodSan Lee and Mui Chow Lee Revocable Trust of time during which the instructions shall remain in effect and describing any other conditions affecting the directions. 3.7. Power to Direct Investments After Death of Deceased Settlor. After the death of the deceased settlor, the surviving settlor shall have the power to direct trust investments (as defined in the previous section) of any trust created under this instrument other than the Disclaimer Trust. No person shall have the power to direct trust investments of the Disclaimer Trust. After the death of the surviving settlor, no person shall have the power to direct trust investments. 3.8. Setilors’ Power to Borrow From Trust Estate While Both Settlors Are Living. Notwithstanding any other provision in this instrument, during the joint lifetimes of the settlors, income or principal of the trust estate may be borrowed with or without security, as provided in this section. The loans shall be in such amounts and on such terms as specified in a signed writing filed with the trustee. (a) The settlors, acting jointly, shall have the power to borrow from the portion of the trust estate that is the settlors’ community property. Both settlors shall be required to sign the writing filed with the trustee. (b) A settlor whose separate property or quasi-community property comprises any portion of the trust estate shall have the power to borrow from that portion of the trust estate. 3.9. Power to Borrow From Trust Estate After Death of Deceased Settlor. After the death of the deceased settlor, the surviving settlor may borrow, with or without security, from the income or principal of any trusts created under this instrument, other than theSan Lee and Mui Chow Lee Revocable Trust Disclaimer Trust, such amounts on such terms as he or she specifies in a signed writing filed with the trustee. 3.10. Exercise of Rights and Powers of Settlors By Others. Any right or power that either settlor could exercise personally under the terms of this instrument, except the power to amend, revoke, or terminate any trust created by this instrument, may be exercised for and in behalf of that settlor by any attorney in fact who, at the time of the exercise, is duly appointed and acting for that settlor under a valid and enforceable durable power of attorney executed by that settlor under the Uniform Durable Power of Attorney Act, or any successor statute, or, if there is no such attorney in fact, by a duly appointed and acting conservator of that settlor, after petition to the court in accordance with California Probate Code Section 2580, or any successor statute. The power to amend, revoke, or terminate any trust created by this instrument is personal to the settlors and may not be exercised by any other person or entity. ARTICLE FOUR DISTRIBUTIONS DURING SETTLORS’ JOINT LIVES 4,1. Payment of Income During Settlors’ Joint Lives. So long as both settlors are living, the trustee shall pay the net income of the trust as specified in this section. (a) Community Property. The trustee shall pay to or apply for the benefit of the settlors, or either of them, all of the net income from the trust community property, in monthly or other convenient installments (but not Jess often than annually) as the settlors, or either of them, and the trustee may agree on from time to time.San Lee and Mui Chow Lee Revocable Trust C (b) Separate and Quasi-Community Property. The trustee shall pay to or apply for the benefit of a settlor whose separate property or quasi-community property comprises part of the trust estate all of the net income from that property, in monthly or other convenient installments (but not less often than annually) as that settlor and the trustee may agree on from time to time. 4.2. Distributions of Principal During Settlors’ Joint Lives. So long as both settlors are living, the trustee shall distribute principal of the trust, at any time or times, as specified in this section. (a) Community Property. The trustee shall distribute to or apply for the benefit of the settlors, or either of them, as much of the principal of the community property of the trust as the trustee, in the trustee’s discretion, deems necessary for the comfort, welfare, and happiness of the settlors, or either of them. (b) Separate and Quasi-Community Property. The trustee shall distribute to or apply for the benefit of either settlor as much of the principal of the separate and quasi-community property of that settlor as the trustee, in the trustee’s discretion, deems proper for the comfort, welfare, and happiness of that settlor. (©) Consideration of Other Resources When Distributing Principal. In exercising discretion under subsections (a) and (b), the trustee shall give the consideration that the trustee deems proper to all other income and resources then readily available for use by the settlor or settlors, as the case may be, for the stated purposes and that are then known to the trustee. All decisions of the trustee regarding such payments, if any, are within the trustee’s discretion and shall be final and incontestable by anyone. 4.3. Distributions of Principal at Request of Settlors. So long as both settlors are living, the settlors shall have the right to withdraw principal of the trust, at any time or time, as specified in this section. (a) Community Property. The trustee shall distribute to the settlors, or either of them, such amounts from the principal of the community property of theSan Lee and Mui Chow Lee Revocable Trust trust, up to the whole thereof, as the setilors, or either of them, may request of the trustee in writing. (b) Separate and Quasi-Community Property. The trustee shall distribute to a settlor whose separate or quasi-community property comprises part of the trust estate as much of the principal of that property, up to the whole thereof, as that settlor may request of the trustee in writing. 4.4. Settlors’ Obligation for Community Property Distributed. Any payment of income or principal from the trust community property to or for the benefit of the settlors, or either of them, shall remain the community property of the settlors. A settlor who receives any such payment shall have the same obligations respecting that property that he or she would have with respect to all community property generally. 4.5. Requests in Behalf of a Settlor Unable to Do So Personally. If, at any time, either settlor is unable personally to make a request of the trustee to withdraw principal of the trust, that settlor’s right to make the request may be exercised for or in behalf of that settlor by an attorney in fact who, at the time of the exercise, is duly appointed and acting for that settlor under a valid and enforceable durable power of attorney executed by the settlor under the Uniform Durable Power of Attorney Act, or any successor'statute. If there is no such attorney in fact, then the trustee shall have the discretion to make any principal distribution to or for the benefit of that settlor that the settlor could have requested personally if he or she were able to do so. In making any principal distribution under this section (whether pursuant to a request by an attorney in fact or not), the trustee shall pay as much of the principal as the trustee, in the trustee’s discretion, deems necessary for that settlor’s health, education, support, and maintenance. The trustee shall have discretion to determine 9C~ San Lee and Mui Chow Lee Revocable Trust when a settlor is unable personally to request principal payments from the trustee for purposes of this section. ARTICLE FIVE DISTRIBUTIONS AFTER DECEASED SETTLOR’S DEATH 5.1. Payment of Death Taxes, Debts and Expense s on Statement From Personal Representative. After the deceased settlor’s death, on receipt by the trustee of a written statement from the personal representative of the deceased settlor’s estate requesting that the trustee pay death taxes, debts, and expenses (as defined in Article Eight), with respect to any property in the deceased settlor’s estate, the trustee shall pay, either directly or to the personal representative, any amounts requested by the personal representative for those purposes, in the manner specified below. The trustee may rely on the personal representative’s statement and shall not be liable for any act or omission by the personal representative in protesting or failing to protest the legality, propriety, or amount of the death taxes, debts, or expenses. If there is no personal representative, the trustee shall make the payments directly. Payments of debts and expenses shall be made by the trustee from the trust estate. All death taxes payable by reason of the death of the deceased settlor shall also be paid by the trustee from the trust estate. Payments under this section on the death of the deceased settlor shall be made only out of (1) the deceased settlor’s separate property, if any, (2) the deceased settlor’s one-half (1/2) interest in the settlors’ community property, and (3) the deceased settlor’s one-half (1/2) interest in the deceased settlor’s quasi-community 10 uASan Lee and Mui Chow Lee Revocable Trust property, and shall not be made from the surviving settlor’s property. Any death taxes that are attributable to a disclaimer of property under this instrument by the surviving settlor shall be paid from the Disclaimer Trust. 5.2. Trustee’s Power to Defer Division or Distribution. Whenever the trustee is directed to divide any part of the trust estate or distribute trust assets on the death of either settlor, the trustee may, in the trustee’s discretion, defer actual division or distribution for a period not exceeding six (6) months after that settlor’s death. The ability of the trustee to delay division or distribution shall not affect the vesting of interests, which shall be as of the date of death. 5.3. Trust Estate Allocated to Power of Appointment Trust. On the deceased settlor’s death, the remaining trust estate shall be held, administered, and distributed according to the terms of the Power of Appointment Trust, as set forth in Article Six. 5.4, Intention That Disposition Qualify for Marital Deduction. The settlors intend that the disposition of the trust estate set forth in the preceding section (to the extent that it provides for disposition of the deceased settlor’s property) qualify for the federal estate tax marital deduction, and this instrument shall be construed accordingly. 5.5. Disclaimer of Property. Any property or portion of property that is disclaimed by the surviving settlor shall be held, administered, or distributed according to the terms of the Disclaimer Trust, as set forth in Article Six. 11San Lee and Mui Chow Lee Revocable Trust ARTICLE SIX DISPOSITIVE PROVISIONS OF TRUSTS CREATED AFTER DECEASED SETTLOR’S DEATH 6.1. Power of Appointment Trust. The trustee shall hold, administer, and distribute the assets of the Power of Appointment Trust as follows: (a) Payment of Income. The trustee shall pay to or apply for the benefit of the surviving settlor, so long as the surviving settlor lives, the entire net income of the trust, in monthly or other convenient installments agreed on by the surviving settlor and the trustee, but not less often than annually. In determining the net income of the trust distributable to the surviving settlor, the trustee shall include all income that must be considered as income in order for the trust to qualify for the marital deduction under the federal estate tax law, and shall make no deductions from gross income that would prevent the trust from: qualifying for that marital deduction, notwithstanding any contrary provisions of this instrument or any applicable provisions of state law. It is the intention of the settlors that the surviving settlor, as the beneficiary of a marital deduction trust, shall have substantially that degree of beneficial enjoyment of the trust during his or her lifetime that the principles of the law of trusts accord to a person who is unqualifiedly designated as the life beneficiary of a trust, and the trustee shall not exercise the trustee’s discretion in a manner that is not in accord with this expressed intention. It is also the intention of the settlors that the trust produce for the surviving settlor during his or her lifetime the income, or that the surviving settlor shall have the benefit of the trust property, as is consistent with the value of the trust property and with its preservation. (b) Discretionary Payment of Principal by Trustee. At any time or times during the trust term, the trustee shall pay to or apply for the benefit of the surviving settlor so much of the principal of the trust as the trustee deems proper for the comfort, welfare, and happiness of the surviving settlor. In exercising discretion, the trustee shail give the consideration that the trustee deems proper to all other income and resources that are then known to the trustee and that are readily available to the surviving settlor. All decisions of the trustee regarding payments under this subsection, if any, are within the trustee’s discretion and shall be final and incontestable by anyone. ~San Lee and Mui Chow Lee Revocable Trust (c) Right of Surviving Settlor to Withdraw Principal. The trustee shall pay to the surviving settlor as much of the trust principal as the surviving settlor may from time to time demand in a signed writing delivered to the trustee. (d) General Power of Appointment. On the death of the surviving settlor, the trustee shall distribute all property subject to the trust (including the trust principal, all net income then held by the trustee, and all income then accrued but not collected by the trustee) to any entity or entities, person or persons, and on any trust, terms and conditions, or to or in favor of the estate of the surviving settlor, as the surviving settlor may direct by will, but only if that will expressly refers to and indicates an intention to exercise this power of appointment. The trustee may rely on any instrument admitted to probate as the last will of the surviving settlor in carrying out the terms of the power of appointment and shall not be liable for any good-faith act in reliance on that will, even if for any reason it is later determined to be invalid with respect to its purported exercise of this power of appointment. If the trustee receives no notice of the existence of a will of the surviving settlor within six (6) months after the death of the surviving settlor the trustee may distribute the trust assets and income as though this power of appointment had not been exercised and shal in that event be conclusively presumed to have acted in good faith, even if a valid will is thereafter discovered. (e) Payment of Death Taxes, Debts. and Expenses. On the death of the surviving settlor and subject to any power of appointment exercised by him or her, the trustee, in the trustee’s discretion, may pay out of the income or principal (or partly from each) of the Power of Appointment Trust the death taxes, debts, and expenses (as defined in Article Eight) arising on the death of the surviving settlor unless the trustee determines that other adequate provisions have been made for the payment of these taxes, debts, and expenses. (f) Default Provision. If any of the property subject to the power of appointment of the surviving settlor is not effectively appointed by him or her, that property, after payment of any taxes, debts, and expenses pursuant to the . applicable provisions of this instrument, shall be distributed to the Disclaimer Trust, to be held, administered, and distributed as part of the Disclaimer Trust. 13San Lee and Mui Chow Lee Revocable Trust 6.2. Disposition of Disclaimer Trust Until Death of Surviving Settlor. During the lifetime of the surviving settlor, the trustee shall hold, administer, and distribute the assets of the Disclaimer Trust as follows: (a) Payment of Income. The trustee shall pay to or apply for the benefit of the surviving settlor the entire net income of the trust, in monthly or other convenient installments as agreed on by the surviving settlor and the trustee, but not less often than annually. Discretionary Payment of Princi Trustee. At any time or times during the trust term, the trustee shall pay to or apply for the benefit of the surviving settlor so much of the principal of the trust as the trustee deems proper to pay the reasonable expenses of the surviving settlor for his or her health, education, support, and maintenance. In exercising discretion, the trustee shall give the consideration that the trustee deems proper to all other income and resources that are known to the trustee and that are readily available to the surviving settlor for use for these purposes. All decisions of the trustee regarding payments under this subsection, if any, are within the trustee’s discretion and shall be final and incontestable by anyone. 6.3. Disposition of Disclaimer Trust on Death of Surviving Settlor.