Motion-Secondary: IN RE: STAN KWONG IRREVOCABLE TRUST II

• 
• 
• 
• 
• 
• 
• 
• 

						
                                
Preview
                                FREELAND COOPER & FOREMAN LLP

150 Spear Street, Suite 1800
San Francisco, California 94105

NN NY NY BY NY KR KN Ye Be ee
oA A A kB OH & SF Ge AA aA SE

Daniel T. Bernhard (CSB #104229)
FREELAND COOPER & FOREMAN LLP
150 Spear Street, Suite 1800

San Francisco, California 94105
Telephone: (415) 541-0200

Facsimile: (415) 495-4332

Email: bernhard@freelandlaw.com

B. Douglas Robbins (SBN 219413)
Kelley Harvilla (SBN 275123)
WOOD ROBBINS, LLP

One Post St., Suite 800

San Francisco, California 94104

T: (415) 247-7900

F: (415) 247-7901
drobbins@woodrobbins.com
kharvilla@woodrobbins.com

Attorneys for Petitioner
Jennifer Shuk-Han Kwok

ELECTRONICALLY

FILED

Superior Court of California,
County of San Francisco

05/02/2018
Clerk of the Court
BY:ROBERT WOODS
Deputy Clerk

SUPERIOR COURT OF THE STATE OF CALIFORNIA

IN AND FOR THE CITY AND COUNTY OF SAN FRANCISCO

JENNIFER SHUK-HAN KWOK, individually,

and as beneficiary of the Stanley Kwong

Irrevocable Trust II, dated September 8, 2008,
Petitioner,

v.

JEANNE KWONG, individually and as a former

trustee of the Stan Kwong Irrevocable Trust II,

Respondent.

AND RELATED CROSS-PETITIONS.

I, Daniel T. Bernhard. declare as follows

CASE NO.: PES-10-293505

DECLARATION OF DANIEL T.
BERNHARD IN SUPPORT OF
PETITIONER’S OPPOSITION TO
RESPONDENTS' MOTION TO DISMISS

PART 2 OF 3

Hearing Date: May 9, 2018
Time: 2:00 p.m.

Dept.: 204 - Probate

Judge: John K. Stewart

Action filed: May 12, 2010

1. I am an attorney licensed to practice before this Court and am a member of the law

firm of Freeland Cooper & Foreman, LLP, counsel for Jennifer Shuk-Han Kwok in this and numerous

other related matters. This representation commenced in July, 2009, and has been continuous. I make

{00285205} 1

DECLARATION OF DANIEL T. BERNHARD IN SUPPORT OF PETITIONER’S

RESPONDENTS’ MOTION TO DISMISS

OPPOSITION TOEXHIBIT 11SUPERIOR COURT OF CALIFORNIA
COURTY OF SAN FRANCISCO

Dee 12,2014

IN RID STANLEY CHONG KWONG

Present:

Judge: JAMES J. MCBRIDE:
Reporter: Not Reported

“Appearances:
Daniel T. Berard

Freeland, Cooper & Foreman, LLP
150 Spear Street, Suite 1800

‘San Francisco, CA 94105
415-341-0200

Jennifer Shuk-Han Kwok, et at

Richard Bryan
Bryan & Flinshaw

425 Califomia Strect, Suite 810
San Francisco, CA 94108
415-296-0800

Feng Quyang

MINUTES

Deparment 220

Case Numbers: PES-09-293019
& PES-10-293550,

Clerk: Kevin Dougherty
Bailif! NA

Appearances:
Phil Foster

Your-Sarkissian Law Offices, LLP
211 Gough Street, Third Street
San Francisco, CA 94105
415-626-7744

Stanley Chong Kwong, et al.

Carl Lippenberger

Law Offices of Curl Lippenberger
591 Redwood Highway, Suite 2375
Mill Valley, CA 949417
415-389-8900

Amy Kwong, Larry Kwong & Sara
Kwong

‘These matters each came on calendar this day for Assigned Case Management
Conference. The Court, court personnel, counsel and respondent Jeanne Kwong are
present. This morning’s proceedings are not being reported

9:17 am. ~ In session. Alt present. ‘The case is called and counsel state their

respective appearances.

Pee £

Case Na eCuse Numbers
Case Title sy Re Cased ittes

Porm Podrea0

Date  2016

T. BERNHARD
or Jennifer Shuk-Han Kwok

“SETTLEMENT CONFE)
(00255740)FREELAND COOPER & FOREMAN LLP

150 Spear Street, Suite 1800

PROOF OF SERVICE

| am employed in the City and County of San Francisco, State of California. I am over the age
of eighteen and not a party to the within action; my business address is 150 Spear Street, Suite 1800,
San Francisco, California 94105,

On December 7, 2016, I served the foregoing document described as follows:
SETTLEMENT CONFERENCE STATEMENT

by placing a true and correct copy thereof enclosed in a sealed envelope addressed to the party(ies) of
record whose name(s) and address(es) appear below:

Phil Foster Carl Lippenberger
Tour-Sarkissian Law Offices Law Offices of Carl Lippenberger
211 Gough Street, 3rd Floor Shelterpoint Business Center

San Francisco, CA. 94102 591 Redwood Highway, Suite 2375

Email: phil@tslo.com Mill Valley, CA 94941
carl@lippenbergerlaw.com

Richard M, Bryan David Wakukawa

Bryan Hinshaw PC Markum Zusman Freniere & Compton, Lip

425 California St., Ste. 810 465 California Street, Suite 401

San Francisco, CA 94104 San Francisco, CA 94104 .

Telephone: 415-906-3085 Telephone: 415-438-4515

Facsimile; 415-296-0812 Facsimile: 415-434-4505

Email: rbryan@bryanhinshaw.com Email: dwakukawa@mzclaw.com
B, Douglas Robbins

Wood Robbins, LLP

One Post Street, Suite 800

San Francisco, Ca 94104

Telephone: 415-247-7900

‘Facsimile: 415-247-7901

Email: drobbins@woodrobbins.com

[BY MAIL - CCP § 1013a] I caused such sealed envelope with postage thereon fully
prepaid to be placed in the United States mail at San Francisco, California, for collection and
mailing to the office of addressee(s) on the date shown herein following ordinary business
practice.

X [BY E-MAIL or ELECTRONIC TRANSMISSION] Based on a court order or agreement of
the parties to accept service by e-mail or electronic transmission, I caused the documents to
be sent to the persons at the email addresses listed above. I did not receive within a
reasonable time after the transmission, any electronic message or other indication that the
transmission was unsuccessful.

X [STATE] I declare under penalty of perjury under the laws of the State of California that
the above is true and correct.

Executed on December 7, 2016, at San Francisco, California.

Denise Lamb

PROOF OF SERVICEEXHIBIT 17BOG

n

a

150 Spear Street, Suite 1800
San Francisco, California 94105

FREELAND COOPER & FOREMAN LLP
2

o

Daniel T. Bernhard (CSB #104229)
FREELAND COOPER & FOREMAN LLP
150 Spear Street, Suite 1800

San Francisco, California 94105

elephone: (415) 541-0200

Facsimile: (415) 495-4332

Email: bernhard@freelandlaw.com

Attorneys for Petitioner/Respondent

Jennifer Shuk-Han Kwok, Executor of the
Estate of Stanley Chong Kwong and Trustee
of the Stanley Kwong and Jennifer Kwok
Revocable Trust, and Trustee of the Stanley
Kwong Marital Trust, and individually

and California Financial Mortgage Corporation

SUPERIOR COURT OF THE STATE OF CALIFORNIA
IN AND FOR THE CITY AND COUNTY OF SAN FRANCISCO

IN RE: STANLEY CHONG KWONG, CASE NO.: PES-09-293019

{Other Cases: PES-09-292733, and
PES-10-293505, and CGC-10-499028

JENNIFER SHUK-HAN KWOK’s
SETTLEMENT CONFERENCE
STATEMENT SUPPLEMENT RE:
INSURANCE DISPUTE

Date: December 15, 2016
Time: 9:30 a.m.
Dept.: 305

Judge: Honorable Mary E. Wiss

Jennifer Shuk-Han Kwok submits the following concerning the Lincoln Benefit Company Life
Insurance dispute (case no. PES-10-293505) as a supplement to her previously submitted Settlement
Conference Statement:

Factual issues have arisen concerning the purposes and intentions for Stan’s Lincoln Benefit
Life Company policy of life insurance, 010U138148 (the “Lincoln Policy”). Stan redesigned his

estate plan beginning in late 2008; that process extended into 2009. Jennifer Kwok, his wife, also

“SETTLEMENT CONFERENCE STATEMENT SUPPLEMENT RE: INSURANCE DISPUTE
{00256373}FREELAND COOPER & FOREMAN LLP

2

150 Spear Street,

prepared her own estate plan at the same time in what was a coordinated effort. Stan died on July 8,
2009,

Before his death Stan designed, in September 2008, three insurance trusts each to hold various
policies of life insurance. He and Jennifer each purchased new life policies from John Hancock: Stan
and Jennifer each purchased an individual policy, and they also purchased a joint life policy. Stan’s
plan was that his individual policy, Jennifer’s individual policy and the joint policy each went into one
of the newly created separate insurance trusts.

Stan also had an old policy from Lincoln Benefit Life Company, (policy 0100138148)
purchased at least 10 years earlier. It had a face value of $1 million. The original beneficiary on the
Lincoln Policy was Stan’s mother, Lau Kwong. While Stan had always been the owner of the Lincoln
Policy, he decided to put that policy into the insurance trust holding his newly produced John
Hancock life policy; the purpose of the Stan Kwong Irrevocable Trust II was to hold policies of
insurance covering Stan’s life individually. A copy of Stan’s handwritten notes showing this intended
organization and the beneficiaries of the various policies is attached hereto as Exhibit 1. These notes
plainly demonstrate that the Lincoln Policy was to benefit Jennifer Kwok through the Trust.

A change of ownership form was completed by Stan, as the owner, and Jeanne Kwong, as the
trustee of the Stan Kwong Irrevocable Trust I], on October 3. 2008. A copy is attached hereto as
Exhibit 2. It was signed by Jeanne Kwong as the trustee of the Trust -- the “new owner.” Lincoln
Benefit Life effected the change, as reflected in subsequent communications from it about the policy.
See, November 7, 2008 letter from Lincoln Benefit Life Company to the Stan Kwong Irrevocable
Trust I. A copy is attached hereto as Exhibit 3. Thereafter Jeanne Kwong -- the new owner of the
Lincoln Benefit policy -- did nothing to change the beneficiary to the Trust to comport with Stan’s
purposes and intentions to benefit Jenifer Kwok, Although Jeanne Kwong apparently had at least one
discussion with Gary Wong about the policy, Mr. Wong also did nothing to insure that the beneficiary
was changed, consistent with Stan’s intentions and purposes.

After Stan’s death it was quickly discovered by others that Jeanne Kwong had failed to change
the beneficiary, despite changing the ownership of the policy. As a result, although the Trust was the

new owner, the beneficiary was still Stan’s mother, Lau Kwong, the original beneficiary under the

“SETTLEMENT CONFERENCE STATEMENT SUPPLEMENT RE: INSURANCE DISPUTE
{00256373}FREELAND COOPER & FOREMAN LLP

on OD

San Francisco, California 94105

Lincoln Benefit policy. This defect was discovered about one month after Stan’s death, and counsel
for Feng Ouyang quickly brought it to the attention of Lincoln Benefit Life in a letter dated August
19, 2009. A copy is attached hereto as Exhibit 4. Counsel also contacted Jeanne Kwongfor assistance
in correcting the mistake with Lincoin Benefit Life, but instead she resigned as trustee and thereafter
ignored every effort by various counsel over several months to obtain her assistance in correcting the
mistake and obtaining the $1 million of insurance policy proceeds. See, copy of the August 27, 2009
letter attached hereto as Exhibit 5.

As a consequence of the trustee’s refusal to take any corrective action -- or any action
whatsoever other than resignation -- Lincoln Benefit Life had no choice but to pay out the policy
proceeds of $1 million to the only identified beneficiary, Lau Kwong. This result was directly

contrary to Stan’s purposes and intentions,

Respectfully Submitted,

Dated: December! 7, 2016 =~ FREELAND COOPER & FOREMAN LLP

\

By: \e
DANIEL T. BERNHARD
Al for Jennifer Shuk-Han Kwok
in her various capacities

SETTLEMENT CONFERENCE STATEMENT SUPPLEMENT RE: INSURANCE DISPUTE
400256373)q

he prvntolay, q Sey
St ew ¥AX TRANSMISSION

K

California
Financial

DATE: 9/ To Ok FROM: Se) Leas ¢
CALIFORNIA
te ___ Fatge Lot re

CORPORATION

co: 3735 Geary Blvd.
San Francisco

REF: Pat Pn abt Pp tof amet
658-9001

FAX fg} 668-3000

WAX#:

# OF PAGES: __ (INCLUDING. COVER PAGE)

a awh. ce cle fiCe”g

pone. SUSTAIN FA¥ [Coss
ECE.
£° (% mic HEClE may jes 6

ao had Sta (4aIr~b — Bene Fo
MO (Vi9, 7

I) “Se hi |< ke
Suse Ser cau
MICH EECE MAY vey

\ BN
\y [C WOK ~BEwE 7,

- pp le
3,) oe (ecb ©

“th KM poppe TA fCwont
a (CH ELLe Peay forawt

*)

IMPORTANT: IF YOUR DO NOY RECEIVE ALL PAGES, PLEASE GIVE

US A CALL IMMEDIATELY AT (415) 668-9000. THANK YOU.

FAX # (415) 668-3000 OR (415) 668-2000. SERVE Kur yh

TASTES S :

ref: fax pen CUYANMG Ki BERM Lo?
1 2G pert a CHRISTA Gow
cre CA, Qtr TO UCe 34 Ta oe

~~ CS) gbI- 12] SE CA Gu pet
i j 1 & (Als Fete!vevochue. 20, 2009 4:22FMGaszes1 Ho. 14370 P. 4

TINGOLN SENEFT Lek

CHANGE eee ee

‘THIS FORM NOT TO BE USED WITH FRAG, 403(b) OR 404 ANNUTTIEN viii a asa

"2H AN. 0

EE att te ropend ce in Cumaretip may result mo lexeble event, Pease sag Section 2 for ackeitional

BEY hes tans an sae ‘Te change of eee
affect the prasont beneficiary or annuitant,

a Bantccs Exiting Outnar cr Abd font Gomer ta Replace Existing Owner CI Add Joint Qumer

2 Delete Joint Owner 0 Add Contingent Ownes (Life only} +1 Delete Jott uner C1 Add Contiagant Oumer (Life only)

‘Change Ownership Type for annuities tar Ownership Type for annunties to

OQ Indeidual O Formetshiy 0 Non Grantor Trust Q Grantor Trust]{ Cy indiviqunt Cl Pomerehlp, C2 Nort Grantor Thist £9 Grarsor Trust

C2 Comorata/Agsoctation ti Quatedial Ascotent O) CurporataiAsevolaton C2 Custodiat Acoount
2 Tax Exemption Profit Organization  Mérior 0 Other 1 Tex Exemptiiton-troft Organtzanon Cl Minor O Giter

cs were id
7 negat froma taxabte 5
of ether the burret contract oF Seg Fereiok contrat tag Uae, 12 monte poriad
eaies Rescate ores of the: ‘appkes to the Owner:
withdrawal ts. ta pro-8/14/62 investnent in th
¢ Lekes age dove bean at ob ty ed van Een ra tate a
olor eat empath atl ote ‘complated and, the withdrawal,
© Heke Fiako 0 wilvdawel rome qualfed fondling sot imder intemal Revere Code soction 490(d).
8. Lacnonied that H this contest were elther tng comct or asblant coat lal 1035

: months, if xceptons feted
ena wat Puetyenaree | eee ee eral cen ot re odnel eet be troated

a cones sod, ¥

been ard 4035 exchenge. Tacknowiedys ee ere all ganale Netra Cee eS te

ja.
ny sere arent Sane taken from my rom mp ooareck earl documentation may be required
before: ry roquodt processed,

PICAsLBL- Page 4 0f2

ae

Eves

Si caaca orice tax penalty. \extrptap thal '

(oore)

Page 2/3 RCVD 10/6/2008 2:42:56 PM [Central Deytight Time] cis1 hyOOOoEs

Nvavephus 20. 2009 4:22PM s57e9% No, 1457 py. bya

ithotize’ Linggin Benefit Life Company and any other fnsnctaf or Ingurence tnetituion that surrendered or
Ct ued proseadt n tial "036 exchange in which tig annully contract ether tacoived of surendered

ecalynd proceeds 66 ofa
7 ot Pitan ebou! me endler cry alnuiky contracia Wet may be mecosuaty to encure contatued

proceads to sitar
Pemwelionce vit Pedra Tas
or outgoing, hes been proosss6d on my contract within the last

. 1 1035 exchange, either inoomin
D. Ht parti one atthe fenguanig events imbst have occarted, after tne partel exehange was ‘completed, to-evod

disqualifying my partial 1035 @: ange.

C1 thave tumed 69%,

C2 Ihave become dlasbled (as defined by Internal Revere Code section 72m)(7)) (You must complete the
Physicians Disability Verflostion Form) 7

CO The Owner 1 now deceased,

1 thave finalized 8 divarce [attach a copy of legal documentation), or

2 thave last employment as of
ManDDICNY

ons above fs clieeked, you are giving us your consent to procase thie
Tote negative tax consaquonces and thw possibilty ofeegatng the preveaus (026

Unloss at feast ona of tha o|
transaction 23 Ie, with poss!

exchange,
Pr MSTENT GAN TaN TAURI eo cnn eo GIS

Under ponaities of perjury, t certify thet:
4. The nuraber shawn on this fort Ie my correct taxpayer identitication number for

to be Issued to me}, and - ea ;
2. Iam nat subject to backup withhaliing because: (e) | am exempt from backup withholding, or (b) I have not
been jatified by the Internal Revenue Service (13) that | om subject to backup withholding as a result of @
fathure to report all Interest or dividends, or (c) the IRS hey netitted me that 1am Mo fonger eubject fo backup
withholding, aru ° * : : |
3%. tam @ U8, person (inchiding U.8. resident silen).

The Intartal Revenue Service does nol requre your consent fo any provisions of this document other than the

1 am walting for a number

urrent Joint Owner's Signalute Date guwvorrryy) New Joint Owner's Signature ‘Bate jaauDorrvyl

* POR HOME OFFICE USE GNLY - ACKNOWLEDGEMENT OF REQUEBT FOR CHANGE
The changes have bean recorded and the original has been retelded. .

—+20__. By.

Dated

FICBALBL-1 Page 2.082 (06/08)

2:56.PM [Central Deviignt Timey 6137 nyGoonsa

Page 3/2 RCVD 190/E/2008 2:4pacenooosenrrspereuurmneicenei6re3

“7 INCOLN BENEHIT LIFE LINCOLN BENEFIT LIFE
P.O, BOX 80469 AW ALLSTATE COMPANY
. LINCOLN NE 68501-0469 ea

HalvackecbsneD beat MbacLasedl sects Mconbecd soll estafectfict

STAN KWONG IRREV TRUST Il DATED 9/8/08
3735 GEARY BLVD
SAN FRANCISCO CA 94118-3208

November 07, 2008

RE:. Policy Number:01U0148138
Insured: STANLEY C KWONG

Dear STAN KWONG IRREV TRUST Il DATED 9/8/08,

‘Thank you for choosing Lincoln Benefit Life Company for your life insurance needs,

As part of our long-standing commitment to customer service, we have historically offered our policy owners these two benefits:
J. ‘The opportunity to add-available riders to life insucance policies after issue, and
2. The opportunity to apply for an improvement in their policies’ rating class.

leave note that while we have offered our customers these benefits, their policies did not iriclude a contractual right to request

Recent changes in the fedoral tax law would provont owners of some in-force life insurance policies from making certain changes
to their policies after December 31, 2008, For example, the two benefits described above would not be allowed. However, the
now restrictions do nat apply if the insurance policy stato thatthe ovmer has a right to request thore benefits. Thereforo, we are
endorsing your policy to gant you those rights co that we can continue to provide you with the flenibility fo meet your changing

‘The enclosed endorsement grants you the right to request the addition of any rider that Lincoln Benofit Life C y makes
available for attachment to your policy. It grants you the right to apply for a change in the insured’s rating class. Without this
endorsement, the changes nientioned above would adversely the tax qualification of your policy as life insurance. Please
note that there is no additional premium or feo for adding this endorsement to your policy. Because this endorsement is
effective immediately, no action is required by you. Please file this letter and endorsement with your contract.

Liicoln Benefit Life Company values and appreciates your business, and we are committed to providing the financial security you
need now and in the future. If you havo any questions, please contact your agent/representative or Lincoln Benefit Life Company
directly at 1-888-420-7040.

Sincerely,

Lincoln Benefit Life Company

Enclosure

Pr\gsa oss eee
EARIBRucuaro M. Baran

set Saas ir an
ann cso aber tase eck
Titorcaones soocruna,
tJ SPEEA IZATION
‘Lanna C. GARRETT
Tel ON ial seen Manta C. Maven,
A PROFESSIONAL CORPORATION
ATTORNEYS AT LAW

August 19, 2009

VIA FACSIMILE TO # (866) 635 4525

Carrie Sykes
Lincoln Benefit Life Insurance

Re: Insured: “Stanley Kwong

Policy # 01-901481138

Owner: Stan Kwong lnrecovable Trust I
Dear Ms: Sykes: :

Thank you for returning my phone call.

We represent Feng Ouyang, a co-trustee of the Stan Kwong Irrevocable Trust I. Per
your request, attached is a copy of the trust Instrument. Please note ‘that the co-
trustees are our client and Jeanne Kwong, who is represented by separate counsel,
Paul Tour-Sarkissian.

Please consider this letter a claim and demand that the policy proceeds be. paid
directly fo the iwo co-frustees.

We would like fo know if there are any other beneficiaries identified on the policy.
The policy beneficiary was. supposed to be changed and the trust is fo be the
designated beneficiary of the policy for tax reasons.

We are concerned that if some other party claims to be a beneficiary that no funds be
distributed to that party.

Upon receipt of this letter, please contact me af once fo acknowledge receipt of the
letter and to respond to questions.

425 CALIFORNIA STREET, SUITE 900, SAN FRANCISCO, CALIFORNIA 94104 * TELEPHONE: 415.296.0800 + Facstatite 415.296.0812