Appendix — Kristovich v. Shu Tong Ng

APPENDIX “A”

IN THE DISTRICT COURT OF APPEAL

OF THE STATE OF CALIFORNIA

SEC UND APPELLATE DISTRICT

DIVISION THREE

Estate of LILLIAN ENG, )

Deceased. )

SHU TONG NG, )

| )

Petitioner, Objectcr )

and Appellant, ) Civil

VS ) No. 27566

)

BALDO M. KRISTOVICH, )

Public Administrator )

Petitioner, Objector )

and Respondent. >

[Filed June 24, 1964 Dist. Court of Appeal, Second

Dis.; J. T. Alley, Clerk].

Appeal from an order of the Superior Court of

Los Angeles County appointing an administrator.

Clarke E. Stephens, Judge. Reversed.

Eng and Lum and Albert C. Lum for Petitioner,

Objector and Appellant.

Harold W. Kennedy, County Counsel. and S. Ro-

bert Ambrose, Deputy County Counsel, for Petitioner.

Objevtor and Resp.:adent.

en

This appeal from an order appointing an adminis-

trator turns upon the right of a Chinese national,

residing in Canton, China, to inherit from a Calif-

ornia decedent.

The decedent, a resident of Los Angeles County,

California, but whose nationality is unspecified in

the record, died intestate December 5, 1962, leaving

both real and personal property. She was a widow

and childless. Some of her estate had been the com-

munity property of the decedent and her predeceased

spouse. She was survived by her mother and her

mother-in-law, who would share in the community

property under Probate Code, section 228,

‘he brother of decedent’s deceased husband filed

a petition for letters of administration, alleging that

he was an heir at law. The public administrator also

petitioned for letters. The two petitions were heard

together end evidence was taken, after which the

probate court found that the mother and the mother-

in-law of the decedent were the heirs at law, and both

were citizens and residents of the Republic of China.

The court concluded that the brother-in-law was not

entitled to share in the estate, and that the public

administrator therefore had priorority under Probate

Code, section 422, and was entitled to letters of ad-

ministration.

niin

The brother-in-law has appealed from the order

denying his petition and granting the petition of the

public administrator.

Appellant contends that under Probate Code, sec-

tion 259,' these aliens are not entitled to inherit in

California unless the country in which they reside

extends reciprocal rights to United States citizens,

and that the record contains no evidence to show that

the communist government which now controls the

Chinese mainland extends any such rights to the Un-

ited States citizens.

In reaching its decision the probate court took

judicial notice of a Tready of Friendship, Commerce

and Navigation between the United States of America

and the Republic of China, which was signed Novem-

ber 4, 1946, and entered into force November 30, 1948.

(63 Stats. 1300.)

Under the provisions of sections 2 and 4 of article

VIII of this treaty, each country agrees in substance

f

1Probate Code. section 259: “The right of aliens not residing within

the United States or its territories to take real property in this State by suc-

cession or testimentafy disposition, upon the same terms and conditions as

residents and citizens of the United States is dependent in each case upon

the existence of a reciprocal right upon the part of citizens of the United

States to take real property upon the same terms and conditions as residents

and citizens of the respective countries of wh'ch such aliens are residents and

the right of aliens not residing in the United States or its territories to take

personal property in this State by succession or testamentry disposition, upon

the same terms and conditions as residents and citizens of the United Srates

is dependent in each case upon the existence of a reciprocal right upon the

nart of citizens of the United States to take personal property upon the same

terms and conditions as residents and citizens of the respective countries of

which such aliens are residens.”’

‘

J

a? ee

that the nationals of either party will be permitted

to inherit both real and personal prop?tty left to them

within the other party’s territory, regardless of the

nationality of the decedent.’

Article “XVII of this treaty reads as follows:

‘“‘Subject to any limitation or exception pro-

vided in this Treaty or hereafter agreed upon be-

tween the Governments of the High Contracting

Parties, the territories of the High Contracting

Parties to which the provisions of this Treaty

extend shall be understood to comprise all areas

of land and water under the soveréignty or author-

ity of either High Contracting Party, execpt the

Panama Canal Zone.”’

By its terms this treaty continues in force for

a period of five years, and thereafter until terminated

on one year’s notice by either party. No notice of

termination has ever been given,

2Section 2, article VIII: “If a naticnal, corporation or association of either

High Contracting Party, whether or not resident and whether or not engaged

in business or other activities within the territories of the other High Contract-

ing Party, is on account of alienage prevented by the applicable laws and regu-

lations within such territories from succeeding as devisee, or as heir in the

case of a national, to real or other immovable property situated therein, or

to interests in such property, then such national, corporation or association

shall be allowed a term of three years in which to sell such property or interest,

this term to be reasonabry prolonged if circumstances render it necessary. The

transmission or receipt of such property shall be exempt from the payment any

estate, succession, probate or administrative taxes or charges other or higher

than those now or hereafter imposed in like cases upon the nationals corpo-

rations or associations of the High Contracting Party in whose territory the

property is or the interests therein are situated. Moreover, such devisee or

heir shall, in conformity with such applicable laws and regulations as are

not inconsistent with paragraph 3 of Aricle XIX. be permitted without inter-

ference to withdraw the proceeds of the sale of such property by obtaining

foreign exchange, in the currency of the High Contracting Party «=? which

=

This treaty, if applicable to the present situation,

will prevail over any conflicting provisions of state

law. (Kolovrat v. Oregon, 366 U.S. 187; 6 L.Ed 2d

218.) If the treaty is not applicable, then California

may apply its local laws of suecession, of which Pro-

bate Code, section 259, is a part. (Clark v. Allen,

331 U.S. 503, 91 L.Ed, 1633.)

In seeking to determine whether subsequent events

have deprived the Chinese people of the benefits of

the 1946 treaty, it is necessary to look to the acts of

the devisee is a national, corporation or association, or of which the heir is

a national, during a period not in excess of three years after application there-

fore, upon the most favorable terms applicable to such currency at the time

application for the withdrawal of such proceeds is filed, provided such applica-

tion is made within one year after receipt of the proceeds of sale to which it

relates.”

Section 4. article VIII: “The nttionals of either High Contracting Party

shall have full power to dispose of personal property 0° every kind anywhere

within the territories of the other High Contracting Party, by testament, dona-

tion or otherwise and their heirs, legatees or donees, being persons of whatever

nationality or corporations or associations wherever created or organized. wheth-

er resident or non-resident and whether or not engaged in business within

the territories of the High Contracting Party where such property is situated.

shall suceed to such property, and shall be permitted to take possession thereof.

either by themselves or by others acting for them, and (9 retain or dispose of it

at their pleasure, exempt from any restrictions. taxes or charges other or high-

er than to which the heirs, legatees or donees of nationals of such other High

Contracting Party are or may hereafter be subject in like cases. The nazionals,

corporations and associations of either High Contracting Party shall be permit-

ted to succeed. as heirs, legatees and donees, to persona! property of every

kind within the territories of the other Hich Contracting Party. left or given

to them by nationals of such other Hich Contracting Party or by nationals of

any third country. and shall be permitted to take possession therecf. either by

tk mselves or by others acting for them, and to retain or dispose of it at their

pleasure. exempt from any restrictions, taxes or charges other or higher than

those to which the nationals, corporations and associations of such other High

Contracting Pary are or may nereafter be subject in like cases. =

_ The language of section 2 is very similar to the provisions of the German

treaty construed in Clark v. Allen, 331 U.S. £03. where the court said (at p

508): “The rights secured are in term ~ right to sell within a specified time

plus a right to withdraw the proceeds . .d an exemption from discriminaiory

taxation. It is plain that those rights extend to the German heirs of “any per-

son’ holding realty in the United States. And though they are not expressed

in terms of ownership or the right to inherit. that is their import and meaning e

bili

the legislative and executive branches of the federal

government for an indication of national policy.

(Clark v. Allen, supra.)

By taking judicial notice of some of the official

acts of the United States Department of State (as

authorized by Code of Civil Procedure, section 1875,

subdivision 3) this court is aware that the mainland

of China is, and for several years has been, under

the control of a political organization commonly re-

ferred to in the United States as ‘Communist China”’

or ‘‘Red China,’’ but which calls itself ‘‘The People’s

Republic of China.’’ The United States does not

extend diplomatic recognition to the People’s Republic,

but continues to regard the Republic of China, pres-

ently residing on the island of Formosa, as the gov-

ernment of China. (See, for example, 44 Dep’t State

Bull. 439, 441 1961) quoting a public statement made

by Secretary of State Rusk.) Notwithstanding its

refusal to extend recognition of Communist China,

our government has, on occasion, delt with represent:

atives of that regime. In 1955 representatives of the

United States and representatives of Communist China

confered ana entered into a written agreement con-

cerning the return of civilians to their respective

countries. (U.S. Dep’t of State, American Foreign

Policy: Current Documents, 1956, at 791 (1959).)

The declaration of the official spokesmen for An-

erican foreign policy have made it clear that the

a a

policy of nonrecognition is not based upon any doubts

that the communist regime is in power, but is the

result of the acts and attitudes of that regime.’

The official public acts of the federal government

demonstrate that our government does not regard the

1946 treaty as controlling the relationships between

American citizens and the inhabitants of Communist

China at the present time. Article II of the 1946

treaty states: ‘The nationals of either High Con-

tracting Party shall be permitted to enter the terri-

tories of the other High Contracting Party, and shall

be permitted to reside, travel and carry on trade

throughout the whole extent of such territories.’’ To-

day, contrary to what the treaty would require if it

were operative, the United States refuses to issue

passports to any of its citizens for travel in the com-

3See, for example, the statement of Secretary of State Dulles in his report

on the Berlin Foreign Ministers Meeting (January 25- February 18, 195+}:

“My basic position with reference to Communist China was made clear beyond

the possibility of m‘sunderstanding.

“In my opening statement (January 26), I said, ‘I should like to state

here, plainly and unequivocally, what the Soviet Foreign Minister already

knows—the United States will not agree to join in a five-power conference

with the Chinese Communist aggressors for the purpose of dealing generally

with the peace of the world. The United States refuses not because, as is

suggested, it denies that the regime exists or that it has power. We in the

United States well know that it exists and has power because its aggressive

armics joined with the North Korean agressors to kill and wound 150,000

Americans . .. We do not refuse io deal with it where occasion requires . .

It is, however, one thing to recognize evil as a fact. It is another thing to

take evil to one’s breast and call it good.’

“That explains our non-recogniuion of the Communist regime and also

our opposition to its admission to the United Nations.” (30 Dep't State Bull.

343, 346 (1954) reprinted in U.S. Dep't of State, American Foreign Policy

1950-1955, at 85, 88 (1957).)

For example of additional statements, see Address of the American Ambas-

sador to Canada, June 21, 1956; 35 Dep't State Bull. 56 (1956) reprinted

in U.S. Dep't of State, American Foreign Policy: Current Documents. 1956.

at 752 (1959); and statement of Secretary of State Rusk. 48 Dep't State

Bull. 698, 702 (1963).

-

munist-held territory. (Dep’t State Bull. 313 (1956)

reprinted in U.S. Dep’t of State, American Foreign

Policy: Current Documents, 1956, at 805 ( 1959).)

In Worthy v. Herter, 270 F. 2d 905 (D.C. Cir. 1959)

the court held that the refusal of the Secretary of

State to issue a passport for travel in Communist

China was a proper exercise of the executive power

to conduct foreign relations. Judicial relief was de-

nied to an applicant who sought to compel the issu-

ance of such a passport.

The present United States policy against trading

with Communist China is just as clear. Foreign

Asseis Control Regulations of the Department of the

Treasury, effective December 17, 1950, issued under

the Trading with the Enemy Act (50 U.S.C. App. §

5), have forbidden all persons under the jurisdiction

of the United States to engage in transactions with

any Chinese national, or even t» deal in merchandise

originating in China except Formosa, unless specific-

ally authorized by the Secretary of the Treasury. (31

C.F.R. §§ 500.101-500.808. )

In United States v. Chinu Daily News, 224 F. 2d

670 (2 Cir. 1955), the court affirmed the conviction

of several persons under the criminal sections of the

Trading with the Enemy Act, their crimes being that

they had extended credit and received payments Irom

a Chinese bank end had set checks to persons on the

China mainland.

ees

These indications of the national policy toward

Communist China and the inhabitants of the main-

land provide satisfactory precedent for the decision

here. Since the executive branch of the federal gov-

ernment does not recognize the treaty as entitling

the inhabitants of Communist China to receive visits

- from or trade with American citizens, the courts

of California are justified in concluding that under

present conditions the treaty is not applicable to

confere inheritance rights on such persons.

It is immaterial that the Foreign Assets Control

Regulations exclude from their prohibition ‘Any

transfer to any person by intestate succession.’’ (31

C.F.R. § 500.525.) This provision, of course, does not

confer any rights of succession on any person who is

not entitled to succeed unde: a treaty or under local

laws of succession. The Foreign Assets Control Reg-

ulations are relevant to this discussion only for the

purpose of demonstrating that the federal government

conducts its affairs upon the pren.’se tnat n-ainland

China is not now under the control of the recognized

government of the Republic of China and that the

persons on the mainland are not entitled to the bene-

fits of the 1946 treaty.

The findings of fact made by the tvial court refer

to the mother and mother-in-law of the decedent as cit-

izens of the Republic of Chine. This finding is based

upon evidence that those persons are Chinese and reside

in Canton. Ther is no other evidence of their political

affiliation. There appears to be no reason to treat

~Ii>—

these persons any differently from any other person

of Chinese nationality who resides in the territory

held by the communist and is subject to the control

of that regime.

ft thus becomes necessary to consider the effect

of California’s reciprocity law as set forth in the

Probate Code. The burden is upo the public ad-

ministrator to prove the existence of the reciprocal

rights referred to in section 259. Estate of Bevilacqua,

31 Cal. 2d 580, 584.)

In the Probate Court the public administrator

relied entirely upon the 1946 treaty, but since we know

that the recognized government of the Republic of

China, which made the treaty, now has nothing to do

with the devolution of property in Canton, the treaty

is not evidence that reciprocity in fact exists. There

being no other evidence on the subject, the order must

be reversed.

Appellant’s brienf suggests that this court take

judicial notice of the absence of any mght of United

States citizens to inherit in Communist China, and

direct the probate court to deny the public adminis-

tretor’s petition. The 1957 amendment to Code of

Civil Procedure, section 1875, now allows this court

to take judicial notice of foreign law. Nevertheless,

we have concluded it would be inadvisable to attempt

to resolve the issue by judicial notice in an appellate

court for two reasons.

oes, em

The first is that taking judicia! notice of foreign

law may be quite a different process from taking

judicial notice of other matters which can be satis-

factorily resolved by examination of readily accessible

documents of unquestioned authority. The reievant

parts of Code of Civil Procedure, section 1875, are as

follows:

‘*Courts take judicial notice of the following:

**4. The law and statutes of foreign countries

and of political subdivisions of foreign countrics ;

provided, however, that to enable a party to ask

that judicial ~tice thereof be taken, reasonable

notice shall be ziven to the other parties to the ac-

tion in the pleadings or otherwise; .. .

‘‘In all these cases the court may resort for

its aid to appropriate books or documents of ref-

erence. In cases arising under subdivision 4

of this section, the court may also resort to the

advice of persons learned in tbe subject matter,

wkich advice, if not received in open court, shall

be in writing and made a part of the record in the

action or proceeding.”’

The practical value of these provisions for giving

notice and for consulting learned persons is particu-

larly apparent when one considers the difficulties of

investigating the legal system of Communst China.

(Cf, Estate of Gogabashvele, 195 Cal. App. 2d 503,

529, discussing the legal system of the Soviet Union. )

= =

We observe that appellant’s brief fails to @te any

book or document of reference containing the law

which he desires this court to notice. The trial court

is the place where the inquiry should first be con-

ducted. (Cf. Estate of Feterman, 202 Cal. App. 2d 552.)

The second reason is that the existence of recipro-

city may involve more than formal law. The issue mas

turn upon the practical working of the foreign sys-

tem, as to which oral test*~ony may be required.

(Estate of Schluttig, 36 Cal. 2d 416, 423; ef. Estate of

Arbulich, 41 Cal. 2d 86, $1: Estate of Gogabashvele,

supra, at 508.)

There is no confiect between what is decided here

and what was said in Estate of Nepogodin, 134 Cal.

App-2d 161. That case involved a California estate

of a decedent who died January 13, 1949, and a group

of claimants who resided in Harbin, Manchuria, China,

then under the dominion of the communist government

of China. Unlike the present case, there was no evi-

dence or contention in Nepogodin thet the claimants

were naticnals of China, only that they were residents.

The treaty therefore conferred no rights upon these

clamants, and was pertinent only as evidence that

China granted inheritance rights to Umited States

citizens, a: required by Probate Code, section 259.

The Nepogodin opinion discussed the conditions which

existed in China in 1949. The communist had taken

control of much of the territory, including Manchuria.

The war was still going on, and the nationalist govern-

-_—

ment had not yet been driven off the coutinent. The

People’s Republic was not proclaimed until September

21, 1949. The court observed (p. 170): ‘It is wholly

unacceptable proposition, net supported by any au-

thority, that with every change in the fortunes of a

fluid civil war, the territory of the state and the

sphere of applicability of its treaties should change.”

Upon that record the trial court’s finding that the

1946 treaty was still in effect, and that by reason of

the treaty reciprocity existed, was affirmed.

The present case, arising 13 years later, involves

no “fluid civil war.’’ The United States denies the

legalit. and morality of the communist regime, but

takes cognizance of its exisience and power. The

relationships of the United States and its citizens with

the people of the Chinese mainland are now affected

by this reality.

The order is reversed.

FILES. J.

We concur.

SHINN, P. J

FORD. J.

APPENDIX “B”

TREATY OF FRIENDSHIP, COMMERCE AND

NAVIGATION BETWEEN UNITED STATES

OF AMERICA AND THE REPUBLIC OF

CHINA (63 Stats. at large, pt. 2, p. 1300)

Section 2, article VIII:

‘*If a national, corporation or association of either

High Contracting Party, whether or not resident

and whether or not engaged in business or other

activities within the territories of the other High

Contracting Party, is on account of alienage pre-

vented by the applicabie laws and regulations

within such territories from succediny as devisee,

or as heir in the case of a national, to real or '

other immovable property situated therein, or

to interests in stch property, then such national,

corporation or association shall be allowed a term

of three years in which to sell such property or

interest, this term to be reasonably prolonged

if circumstances render it necessary. The trans-

mission or receipt of such property shall be ex-

empt from the payment of any estate, succession, |

probate or administrative taxes or charges other

or higher than those now or hereafter imposed

in like cases upon the nationals, corporations or

associations of the High Contracting Party in

pe aa

whose territory the property is or the interests

therein are situated. Morever, such devisee or

heir shall, in conformity with such applicable

laws and regulations as are not inconsistent with

paragraph 3 of Article XIX, be permitted with-

out interference to withdraw the proceeds of the

sale of such property, by obtaining foreign ex-

change, in the currency of the High Contracting

Party of which the devisee is a national, corpora-

tion or associatior, sr of which the heir is a na-

tional, during a period not in excess of three

years after application therefor, upon the most

favorable , terms applicable to such currency at

the time application for the withdrawal of such

proceeds is filed, provided such application is

made within one year after ~eceipt of the proceeds

of sale to which it relates.’’

Section 4, article VIII:

‘“‘The nationals of either High Contracting

Party shall have full power to dispose of personal

property of every kind anywhere within the ter-

ritories of the other High Contracting Party,

by testament, donation or otherwise and their

heirs, legatees or donees, being persons of what-

ever nationality or corporations or associations

whereever created or organized, whether resident

or non-resident and whether or not engaged in

business within the territories of the High Con-

tracting Party where such property is situated

shall succeed to such property, and shall be per-

ae

mitted to take possession thereof, either by them-

selves or by others acting for them, and to retain

or dispose of it at their pleasure, exempt from

any restrictions, taxes or charges other or higher

than those to which the heirs, legatees or donees

of nationais of such other High Contracting

Party are or may hereafter be subject in like cases.

The Nationals, corporations and associations of

either High Contracting Party sha!! be permitted

to succeed, as heirs, legatees and donees, to per-

sonal property of every kind within the territories

of the other High Contracting Party, left or given

to them by nationals of such other High Con-

tracting Party or by nationals of any third

country, and shall be rpermitted to take posses-

sion thereof, either by themselves or by others

acting for them, and to retain or dispose of it

at their pleasure, exempt from any restrictions,

taxes or charges other or higher than those to

which the nationals, corporations and associations

of such other High Contracting Party are or may

hereafter be subject in like cases. . .”’