Crosby v. HLC Properties, Ltd.

223 Cal. App. 4th 597, 14 Cal. Daily Op. Serv. 1092, 167 Cal. Rptr. 3d 354, 2014 WL 318205, 2014 Cal. App. LEXIS 94
CourtCalifornia Court of Appeal
DecidedJanuary 29, 2014
DocketB242089
StatusPublished
Cited by13 cases

This text of 223 Cal. App. 4th 597 (Crosby v. HLC Properties, Ltd.) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Crosby v. HLC Properties, Ltd., 223 Cal. App. 4th 597, 14 Cal. Daily Op. Serv. 1092, 167 Cal. Rptr. 3d 354, 2014 WL 318205, 2014 Cal. App. LEXIS 94 (Cal. Ct. App. 2014).

Opinion

Opinion

CROSKEY, J.

HLC Properties, Ltd. (HLC), and Kathryn Crosby (Kathryn) appeal the trial court’s order granting the Estate of Wilma Wyatt Crosby’s *600 (Wilma’s Estate) petition 1 and holding that Wilma Crosby (Wilma) possessed a community property interest in her former husband’s right of publicity. HLC and Kathryn argue that (1) the Wilma Wyatt Crosby Trust’s (Wilma’s Trust) prior settlement of Wilma’s community property claims bars this petition, and (2) the right of publicity is not community property. We agree with the first point asserted by the HLC and Kathryn argument, 2 and therefore, reverse.

FACTUAL AND PROCEDURAL BACKGROUND

Harry Lillis Crosby, professionally known as Bing Crosby (Bing), was a popular 20th century entertainer. He married Wilma on September 29, 1930, and they had four sons together. 3 Wilma died on November 1, 1952, and her will provided that her community property be distributed in trust to her sons.

Bing remarried, and remained married to his second wife, Kathryn, until he died on October 14, 1977. His will did not provide for Wilma and left the residue of his estate to a marital trust for the benefit of Kathryn. After Bing’s death, appellant HLC was formed for the purpose of managing Bing’s interests, including his right of publicity. 4

On September 18, 1996, Wilma’s Trust sued HLC and Kathryn for declaratory relief as to the trust’s entitlement to “interest, dividends, royalties and other income derived from the community property of [Bing] and [Wilma] . . . ,” 5 In 1999, the parties settled for approximately $1.5 million. The settlement agreement provided, in part, that it was “in complete and final settlement of all claims from any source whatsoever of royalties, income or *601 monies due [Wilma’s Trust] and all beneficiaries of the Trust, arising from property interests acquired by [Wilma], as a result of her marriage to Bing Crosby, through the date of this Agreement.”

The settlement agreement specified each source of income due Wilma’s Trust and provided that “there are no other royalties/income due or payable to the Trust . . . with respect to Bing Crosby in any medium.” However, the agreement also provided that, “[s]hould other income derived from works or performances of Bing Crosby during [the marriage with Wilma] be discovered in the future, .... [t]he Trust is entitled to its share . .' . .” The agreement did not specifically address Bing’s right of publicity.

In addition, the agreement contained a release of all claims which provided that the settling parties, “hereby compromise, release, acquit and forever discharge one another . . . from all manner of actions, suits, liens, indebtedness, damages, claims, judgments, obligations and demands of every nature, kind or description whatsoever, whether known or unknown and whether suspected or unsuspected, which [Wilma’s Trust] has or hereinafter, can, shall or may have against [HLC and Kathryn] directly or indirectly based upon or arising out of any act, duty, agreement, omission, transaction, event, occurrence, or any other matter whatsoever, whether now known or unknown, which occurred prior to the date of this Agreement. Each party is aware of and expressly waives, to the full extent permitted by the law, the benefits of California Civil Code § 1542, which provides as follows: ‘A general release does not extend to claims which the creditor does not known or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor.’ ” Wilma’s Trust thereafter dismissed the action with prejudice.

On June 14, 2005, the trustee for Wilma’s Trust wrote counsel for HLC stating that “[a]ll revenue resulting from the right to publicity of Bing Crosby should be shared with the beneficiaries of [the Trust]” because the right is “the community property of Bing . . . and Wilma.” 6 On January 1, 2008, the Legislature amended Civil Code section 3344.1 (section 3344.1), subdivision (p), the statute which provides that a deceased celebrity’s right of publicity is descendible, to state that “[t]he rights recognized by this section are expressly made retroactive, including to those deceased personalities who died before January 1, 1985.” On June 23, 2010, Wilma’s Estate filed the present petition for an order stating that Wilma possessed a community property interest in Bing’s right to publicity, and that Wilma’s share of this interest passed to her heirs pursuant to the terms of her will. HLC and Kathryn opposed the petition on the grounds that (1) the 1999 settlement agreement barred it, and (2) the right of publicity is not community property.

*602 The trial court granted the petition and entered an order holding that Wilma’s Estate had “a community property interest in Bing[’s] right of publicity [that Wilma] acquired during their marriage and that this community property interest passed by her testamentary dispositions” to her heirs on the grounds that (1) the 1999 settlement agreement did not bar the petition because the 2008 amendment to section 3344.1, “created a right that did not exist before by including deceased personalities who died before January 1, 1985 among those entitled to exercise the right of publicity;” (2) res judicata did not apply because the “petition presented here d[id] not come close to raising the same claims or issues described in the 1996 . . . Complaint” which “sought monetary damages for monies wrongfully withheld by HLC”; and (3) section 3344.1 “makes no mention of the community property aspects of the right of publicity, much less any mention that the right of publicity is separate property, or purports to be an exception to the general rule of Family Code section 760” that “there is a community interest unless otherwise specified.” HLC and Kathryn timely appealed.

CONTENTIONS

HLC and Kathryn argue that (1) the 1999 settlement agreement released Wilma’s Estate’s claims to Bing’s right of publicity, (2) the 2008 amendment to section 3344.1 did not create a new right of publicity in Bing’s estate, and (3) the right of publicity is not community property.

DISCUSSION

1. Standard of Review

The application of the doctrine of res judicata and the interpretation of the contract at issue here present questions of law that we review de novo. (State Farm General Ins. Co. v. Workers’ Comp. Appeals Bd. (2013) 218 Cal.App.4th 258, 268, fn. 4 [159 Cal.Rptr.3d 779]; Windsor Pacific LLC v. Samwood Co., Inc. (2013) 213 Cal.App.4th 263, 273 [152 Cal.Rptr.3d 518] [“We interpret a contract de novo if the interpretation does not turn on the credibility of extrinsic evidence ....

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Bluebook (online)
223 Cal. App. 4th 597, 14 Cal. Daily Op. Serv. 1092, 167 Cal. Rptr. 3d 354, 2014 WL 318205, 2014 Cal. App. LEXIS 94, Counsel Stack Legal Research, https://law.counselstack.com/opinion/crosby-v-hlc-properties-ltd-calctapp-2014.