Recent Case Alert

Sterling v. Sterling

Filed November 16, 2015, Second District, Div. Eight

Cite as B258151

Donald Sterling appealed probate court orders concerning the sale of the Los Angeles Clippers, an NBA team and a major asset of the Sterling Family Trust. First, the appellate court found that Donald Sterling was properly removed as trustee pursuant to the terms of the trust, which was supported by evidence presented by physicians as to his lack of capacity and his inability to manage his finances and withstand undue influence. Second, the appellate court found that Probate Code section 1310(b) authorized the probate court to instruct the trustee, Rochelle Sterling, to sell the Clippers notwithstanding the stay on appeal of the probate court’s order, because the risk of loss to the trust estate if the sale fell through was extraordinary or imminent given the $2 billion purchase price as compared with other offers and valuations. Third, the appellate court held that it was not improper for the trustee to wind up the affairs of the trust, even after Donald revoked the trust. The trustee’s winding up of the trust included seeking the best possible result for the beneficiaries in selling the Clippers, in accordance with her duty of loyalty as trustee.

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